This article will briefly describe this loan type, talking in details about the amount of money this loan provides you with, about the qualification process, about the documentation, about some benefits, and finally about the difference between a secured and an unsecured improvement loan. Take a quick read at this article, and the key for your dreams’ fulfillment will be in your hands!
Let’s get started with the funds themselves that can be obtained with such a loan. The good news is that secured home improvement loans provide you with an amount of money you need exactly. As you don’t carry potential risks to your creditors (as your loan is secured), you can get almost as a large amount as you can imagine. So it’s sure the amount you can get will be enough for all of your planned improvements! Moreover, you can choose to have a fixed interest rate for the whole repayment period and thus you will have fixed installments for the entire length of your secured home improvement loan. Isn’t it great?
Let’s move on and talk about qualification! There aren’t many things to be mentioned here, as if you have something to provide as collateral, then practically you are eligible to a secured home improvement loan. Some more points are that the collateral’s market value should be adequate and competent; the borrower must be of statutory age with a regular, sufficient income that lets him or her repay the loan
. One more thing that won’t necessarily exclude you is the credit history. Although a poor one won’t disqualify you, it’s an advantage if you have a good credit score.
The needed documentation is as follows: property-estimation fee (for the valuation of your house by an authorized person), and a contract that contains the planned home improvements and their estimated costs. You’ll also need the actual home improvement plans, some evidence documents regarding paid taxes, a contractor information sheet, a borrower application form, a letter signed by both parties and that’s all! You can obtain all these documents in some days, it’s not so complicated!
Talking about the benefits of this loan, the first thing to be mentioned is its flexibility. Depending on your personal needs and financial circumstances, you can get different amounts of money; you can opt for various rate types and lengths of repayments. You can also apply to a joint loan, thus making it easier to obtain the loan, and meet the payback obligations. Flexibility thus refers both to the diverse loan types that exist and the simple approval. You can get the necessary funds as soon as one day after the completion of the needed documents. More than that, you can use part of the funds provided by a secured home improvement loan to other improvements than those related to your home. Another advantage would be that you are very likely to be eligible to tax-deduction regarding your improvement loan’s interest rates.
The main difference between unsecured and secured loans is that you are required to guarantee the latter by a mortgage on the property
that will be improved. However, this increased security or guarantee given to the creditor also means that they will give you larger funds if needed than you could get with an unsecured loan, and the applying interest rates are also lower. A final advice for you: be careful to be able to meet the repayment deadlines, otherwise your home may be repossessed!
All in all, a secured home improvement loan can easily make your dreams come true, but be careful, think it over and compare the various offers to choose the best existing one!
Have some good home improvement experiences!