Home Remodeling Loan in AmericaAre you planning to remodel your home by building a new kitchen, bigger bathroom ...or family room?
There are three ways to pay for a remodel to your new home.
1. Our Remodeling Loan is designed for the homeowner who is planning to do a major improvement to his or her primary residence.
To calculate the finished appraised value both the current and finished value of the planned home improvements is used. Financing allows the flexibility of a 30-year amortized Construction Loan ARM Produt.
2. . The second way for arranging funds to complete your major remodel is by paying off the current mortgage with a new construction loan.
This method is most popular, as you can obtain a whole new loan to pay off the old mortgage and request funds to complete the remodel based on current and finished value of your remodel.
This method provides you with one new interest rate locked in up front instead of two different rates if you got a second mortgage (one high, one low) blended together .
3. Last method is to get a home equity line of credit to pay for your remodel. This loan is inexpensive to obtain but the interest rate is usually based on the prime rate plus.
Currently, the prime rate is in 4% range. When interest rates are low this loan can be a great way to add on to your home but will not be based on finished value but existing current value. In many cases depending on the amount of funds needed you may not have enough equity to finish the project and running out fund is a real possibility.
If you need help determining the best way to obtain financing to remodel your home, call me at (866) 211-3344 and I will help you.