The Best Loan Options to Complete Your Home Improvements
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Home improvement projects can significantly transform your living space, add value to your property, and increase your enjoyment and comfort within your home. Whether you’re upgrading your kitchen, adding an extension, or simply planning to spruce up your backyard, funding is often a major consideration. With so many options available, choosing the best loan for home improvements can be overwhelming. We’re here to guide you on your home improvement journey and help you pick the best loan option to finance your project.
Home Equity Loan
A home equity loan, often referred to as a second mortgage, is one of the most popular loan options for financing home improvements. These loans allow you to borrow against the equity in your home – the difference between your home’s current value and what you owe on the mortgage. There are several advantages to choosing a home equity loan to fund your home improvement projects:
- Lower interest rates which, in turn, lowers your monthly payments
- Longer repayment periods giving you more time to pay off your loan
- Fixed interest rates, giving you predictable monthly payments
Home Equity Line of Credit (HELOC)
A home equity line of credit , or HELOC, is similar to a home equity loan but works more like a credit card. Instead of receiving a lump sum, you will get a line of credit that you can draw from as needed during a specified period, usually around 10 years. There are several advantages that may make a HELOC the best option for you:
- Flexible borrowing means you can borrow what you need, when you need it, making it ideal for long-term or phased home improvement projects
- HELOCs often come with lower interest rates than personal loans or credit cards
- Once you’ve paid off your balance, use your HELOC to consolidate debt or cover other expenses
Home Improvement Loan
Our home improvement loan is a great option to consider when funding your home improvement projects. Unlike home equity loans or HELOCs, our home improvement loan is an unsecured personal loan, making the amount you’re eligible to borrow different. Instead of considering the value of your home equity, lenders will consider a number of other factors on your application, including your credit history, existing debts and more. Use your home improvement loan to complete projects such as:
- Increasing sustainability
- Remodeling your kitchen or bathroom
- Making improvements to your outdoor living space
- Completing essential repairs and maintenance
Credit Cards
Using a credit card for home improvements can be a good option for smaller projects, especially if you have a card with a 0% introductory APR offer. This can give you a window of time to pay off the balance without accruing interest. Easily charge the cost of your project to your credit card, then pay the balance off over time. When using a credit card for your project, consider these factors:
- Pay your balance on time and in full to avoid interest charges
- Consider a credit card with perks such as a rewards program
- Shop for special introductory rate offers to save the most money
Choosing the right loan option for your home improvement project depends primarily on your financial needs and the scope of the project being completed. Before committing to any loan, it’s essential to shop around, compare rates, and consider your long-term financial goals.
Next Steps
Ready to renovate your space? Let us help! Our dedicated team is waiting patiently to serve you.
- Make an appointment to visit your local branch
- Start your application online
- Read our blog for improvements to make to boost your home’s value
Read our other blog articles to help you gain the financial knowledge you need to succeed.