Home improvements can help uplift your property. Your home is one of your greatest assets. It’s a place which holds a lot of value, not only in equity, but in personality. Throughout the years, you might have made changes in and around the house, and as we change as people, we might have the desire to switch up our homes and make any changes necessary. It’s no secret however that these home improvements do come with a cost, and for some, these costs may outweigh their budget, so how can you afford to make these property updates?
Increase Your Monthly Income
One of the first things you could consider doing to help build up funds is to build up your own income. This could be done through your place of work. Speaking to your employer and finding out what you need to do to earn a promotion. If you feel your current work place isn’t paying you highly enough for the value you provide to the company, you may also consider finding a new place of employment.
You could also take up a second job. This could be a part-time job you do on the weekends or in the evenings. Some people monetise their hobbies so that they can have fun and build up their income at the same time. Almost any hobby can be monetised to some degree, so taking your skills and utilising them to make an income can be a fun way to boost your monthly income.
Once you are able to build up your monthly income, then you may be in a better position to put money towards your home improvements. For some, affording home improvements may take a few weeks, months or even years to save up for, however it’s an cost effective opportunity to save the money you earn, and budget for the change your home needs.
Release Equity In Your Home
A great way for you to fund major home improvements is by releasing equity from within your home. If you’re not sure how equity release works, let us explain it to you. Think back to when you first purchased your home, when you entered into a mortgage agreement. You have been making monthly repayments on your mortgage, and the more repayments you make, the more equity you may have built up.
Depending on when you first purchased your home, and the initial cost, you may have built up a substantial amount of home equity. As property prices go up, so does the equity in your home. Simultaneously, if your property value goes down, so does the equity in your home. This home equity could be released to allow you to fund major home improvements. For example, you could use the equity release to fund an extension, or to afford a crucial repair to the structure.
Depending on your age you could look to release equity via remortgaging your existing residential mortgage. Or if you’re over 55 you may be able to access funds via an equity release plan.
When it comes to equity release, there are a few eligibility requirements to be met. For starters, you must be aged 55 or over, have a property worth £70,000 or more, and be wanting to withdraw at least a minimum of £10,000. If you’re wondering how much equity can I release, then you could get a potential release amount by using Retirement Solutions equity release calculator. As an independent equity release broker, they will work closely with you and all the lenders on the market to find the best plan for you. If an adviser deems equity release right for you, the tax-free cash could enable you to focus on the finer details of your home improvement plans.
It’s also worth pointing out that you can release your equity in a few different ways. You could release the equity in a lump sum, so that you get it all at once, or you could release it through a drawdown. This will start with an initial release, with the lender agreeing a ‘drawdown’ facility of equity that can be released in the future, as and when you need further tax-free cash.
Essentially, if you are a homeowner who is aged 55 or over, then releasing equity to fund your home improvements could be an ideal solution. It’s important to remember, what may work for one individual may not work for another. This is why you should consult those who are knowledgeable in this area, so that you can get more relevant advice for your situation.
Use A Credit Card
Credit cards have been used to help afford major purchases for a long time now. Depending on your credit score and your eligibility, you may be able to sign up for a credit card with a high allowance for spending. This credit card could be used to outright pay for an expensive home improvement project or get the ball rolling in some way.
There are many different credit card providers out there, meaning you shouldn’t be short of options. You can contact the bank that you do your banking with, or you could contact a bank or financial provider who you have not opened an account with before. They may have unique sign-up offers that can allow you to have more money ready to spend.
You have to remember the rules that come with a credit card. You should be aware of the interest rates that you are signing up for, and be aware of when the money is being paid back. Most credit card providers will allow you to repay a small fee back each month before the high-interest rates kick in. You don’t want to fall behind on your repayments, which will mean you have to pay more back.
It is always best to speak to a financial adviser or someone with credit card experience before you sign up for one. This allows you to gain more of an understanding of what you’re getting yourself into and can even get you to gain a credit card quicker than you expected. The last thing you want to do is sign up for a credit card and spend it without knowing your repayment terms.
Seek A Personal Loan
While a credit card is a viable option, a loan could also give you the means to start and finish home improvements. A loan can be sourced to give you exactly the amount you need to renovate the home, and a repayment plan can be set up ahead of time. Compared to a credit card, this means that you will be able to know exactly how much needs to be paid back, and how long it has to be paid off.
With many loan providers, they will set up your repayment plan so that it is automated. This means that as long as you have the money in your account, you don’t have to worry, as it will be taken care of for you. Again, you will have plenty of warning about this, so it won’t come as a shock when it comes out.
There will be loan providers out there that specialise in providing loans for home improvement-related reasons. This could help you to get a loan approval quicker than if you perhaps went to the bank. It’s important to note that every situation here is different, so there are no guarantees. If you have any doubts at all, then you should contact loan providers of all kinds to get quotes and discuss your options.
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