Surprise - Surprise!
No matter where you live, if you own a home, building or any other type of real estate and looking for a loan for home improvements, what in the world are you doing going to a bank, credit union or private party? Many of those lenders are nothing but legal real estate who waste time. Here's a clue, owners! If you own a property you can just simply borrow from one of two sources: an equity line of credit (HELOC) or a home equity loan (HEL) It works this way. With the HELOC you sign up, get a predetermined cash limit, then pay the money back on a regular monthly basis with the option to take out as much cash as needed. With the HEL you get whatever you need for your home improvement handed to you and you make a monthly payment that fits your budget.
Say Hello To These Benefits
Well, to be honest, both of these home improvement loans are quite appealing. Both offer lower interest rates and way, way lower than any credit card could offer. Why, you may ask? The answer is simple. The HELOC or HEL lender is going to use your property as collateral or security in case something unforeseen happens. Oh, one more thing. Your home improvement loan may be eligible for tax advantages.
The HELOC will usually carry a lower interest rate but that is if your credit is good.
This loan also carries a few closing costs.
Note: Borrowers of home improvement loans should know that these type of loans must be repaid. If you know up front what you're facing it's a good deal. You need to verify your income and that you actually own the property and the HELOC gives you 20 years to repay.