Considering a Home Improvement Loan
on Borrowing Money for Home Improvements
There are many options available to homeowners who
would like to raise cash for a home improvement projects such as installing
double glazing – There
are many lenders and thousands of products to choose from.
Below gives some information on the options available such as using a credit
card, differences between a secured and an unsecured loan and also remortgaging.
Unsecured Loans & Credit Cards
These options can offer a quick route to funds, but can prove to be very
expensive. Acceptance is usually decided on the result of a credit score
which is based on such things as your employment status, income and credit
If considering an unsecured loan, the maximum period is normally 5 years
(60 months). This would mean your monthly payments could be quite high compared
to a secured loan or mortgage where you will be able to spread your payments
over a far longer period of time.
There are excellent deals available if you are prepared
to shop around, but generally the interest rate you pay is higher than
mortgages and secured
loans. By their very nature, these forms of credit involve the lender taking
more risk – which is why the interest rate is increased.
These types of lenders tend to have little or no tolerance of late payments.
They are very quick to take legal action to recover missed payments and in
such cases will usually demand repayment of the full amount borrowed, plus
interest, along with legal costs incurred.
If you can’t get more money from your bank or
building society, there are loan providers willing to advance the funding
you seek. Some home improvement
deals may involve money being released to you in stages throughout the term
of the home improvement project. The final cost may be different from the
budgeted amount so its best to ensure you only borrow the money you need.
Other options such as Secured Loans
A secured loan is secured against your home as a second
charge behind your mortgage lender, the loan rate rates are lower than
unsecured forms of credit – because
the lender has an interest in your property.
A secured loan gives you a lot more flexibility on
the repayment term – you
can spread your payments over 5-25 years, and in some case, up to 30 years.
This results in low monthly payments. One of the main differences between
secured and unsecured loans is the amount you are able to borrow – with
secured loans; lenders can advance up to £250,000, and sometimes more.
To secure a loan against your property it’s not
necessary to own your home outright, just sufficient equity to cover the
amount that you are looking
to borrow. As secured loans give lenders a degree of safety, in the event
of difficulties with borrowers meeting the monthly repayments, a lender will
usually take a long-term view and allow some leeway, knowing the property
is there as collateral.
The most important factors when applying for a secured loan is the available
equity in your property and your ability to meet the repayments.
Secured loans give many tens of thousands of people the opportunity to borrow
money, people who may be turned down by more traditional providers and sources
A remortgage gives you the opportunity to pay off your existing mortgage,
and by taking advantage of the available equity in your home, you could raise
additional cash for home improvements, debt consolidation or any other reason.
The advantage with this form of finance is you only
have the one monthly payment to make – and that’s your mortgage!
With competitive interest rates, you could even be better off each month!
There are thousands of mortgage products on the market to cater for all
circumstances. Choose from interest only, variable rate, tracker, fixed rate,
capped, discounted, cash back and so on, but be sure to take advice from
a regulated mortgage advisor to give you all the information you need before
making a decision.
One of the major benefits of a remortgage is that depending on the lender,
your credit history, employment status and income are no major factors when
it comes to approving your application. What is important is the available
equity in your property and your ability to meet the repayments every month.
Ideal for the double glazing installation you might have been considering!
If you wish to receive information on installing double glazing along with
information on financing it, then please
click here to visit our request form.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME
MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A/YOUR MORTGAGE OR
ANY OTHER DEBTS SECURED ON IT.