When it comes to home improvement projects, most people envision a new coat of paint. However, when you want to replace the staircase, put up a new patio and combine three rooms into one, home improvement financing seems all but unavoidable.
Mortgages and equities are part of house improvement financing. These are known as secured loans, for which collateral, usually in the form of your property, is required. Keeping up regular repayment is important, and the home owner who neglects these risks losing his home. There are also unsecured loans. The amount for unsecured loans is lower than that for secured loans, but the interest rate charged is often much higher.
It is possible to renovate your home without resorting to a bank loan by carrying out the house improvement in stages. Complete each stage of the project in the order of its importance. Spending only what you can afford allows you to pace your home development to what suits you best. It may take longer, but at least you don’t have to service a bank loan.
Last, but not least, you can always carry out your projects on your own. It’s impossible to avoid hiring people entirely but you won’t need home improvement financing to pay the electrician. Attending workshops and asking questions at stores is a good way to learn as you go. As with carrying out the renovation in stages, home projects carried out this way will take more time, but you will end up saving a lot more on the expenses incurred.
You should always keep in mind that any home improvement activity you carry out has one main objective – to improve the quality of life of everyone who lives under that roof. Never get talked into anything more extravagant than what you planned; learn to trust your gut.
With the world cup football being played in South Africa in 2010, there have been many reasons and opportunities for South Africans to finance home improvement, as many people are looking to capitalize on their chance to rent out their homes for the event. The better the facility the more rent one can charge.
Now one not only increases the long term value of ones property, but also has a sure fire way to pay of, at least a god chunk of the home improvement financing and who knows, maybe one can make a profit as well. Now this is of course of no use to anyone outside of South Africa, but there must be some sort of event you can think of that could offer a similar opportunity. For example, in London they have the Olympic Games coming up in 2012.
You see, a huge variable when it comes to making money, including renting out property, is timing. Keep looking out for that special reason to start your home improvements, and getting a home improvement loan suddenly stops being a ‘calculated risk’ and more ‘good timing’. There are suddenly more reasons on the pro side than on the con side.
Even so, do not forget to do your homework. Make sure, even though interest rates on a loan are low at the moment, consult with your loan officer about what kind of escalation you can expect and if you should fix the rate. Remember to work with you finance company as these people are your partners in this thing and it is to the advantage of both to make sure this thing goes smoothly.
Besides your loan officer, make sure you have any other necessary connections in place. For example if you were in South Africa, looking to rent out a property during the world cup, inquire at a few estate agents that specialize in home rental and are looking for properties to fulfill the demand. Make sure all your insurance is in place as well just in case the football fans you rent out to be disposed to be a little ‘overenthusiastic’ in the same example.