Title:
Home Equity Loans
The Best 2nd Mortgage for Financing Home Improvements
Word Count:
483
Summary:
Tired of looking
at those avocado green kitchen appliances?
The wood paneling and shag in your family room? The worn fiberglass tub enclosure in the
guest bath? Home improvement is sweeping
the country. Approximately half of
fixer-uppers are do-it-yourself, while the other half is contractor driven. People are financing these improvements with
home equity loans.
Keywords:
Home Equity Loans,2nd
Mortgage,Financing Home Improvements,second mortgages,home equity lines of
credit,home improvement loans,refinance,cash out refinancing, interest
rates,bad credit mortgage loans
Article Body:
Tired of looking
at those avocado green kitchen appliances?
The wood paneling and shag in your family room? The worn fiberglass tub enclosure in the
guest bath? Home improvement is sweeping
the country. Approximately half of
fixer-uppers are do-it-yourself, while the other half is contractor driven.
So how do you decide when to move or stay around, when a home remodel is a good
idea or not?
“The American Homeowner Foundation estimates the total cost of moving to be at
least 10 percent of your home's current value. In other words, if you can make
things right with your home for less than 10 percent of what you could sell it
for, it makes sense to stay put and fix it up.”
There’s a couple of ways for you to start the transformation of your home. If you have enough equity built up for the
total cost of the project, a traditional home equity loan might work for
you. Benefits of home equity loans often
include a better interest rate. You
might even lower your mortgage payment while increasing the value of your
home.
For the do-it-yourselfer working toward several small projects, a home equity
line of credit allows flexibility. The
lender basically sets up a line of credit based upon the equity in your
home. The, issues you checks or a credit
card to draw from the account as you need the cash.
Simply make sure refinancing your home makes financial sense says Lori Vella a
senior banking executive.
"Improving your home is almost always a smart investment,
especially in this rate environment. Just make sure you'll be in the home long
enough to recoup the cost of refinancing," says Vella.
A 2004 survey by Remodeling Magazine compares construction costs to likely
return on investment (ROI) at resale. RM
sent surveys to 20,000 appraisers, sales agents, and brokers. Those industry insiders generating 356
responses (a 1.78% response rate).
The RM survey shows minor kitchen remodels do the best, returning 92.9 percent
of your investment, followed closely by new siding at 92.8 percent. The survey also lists bathrooms, attic
bedrooms, deck additions and family or sun room add-ons as lucrative
investments. Most of those remodels
returned 80% to 90% for the home owners.
A home remodel is one of the best ways to improve the value of your home. Financially speaking, a home-equity loan
could allow you to lower your mortgage payment, lower your interest rate, and
when the remodel is said and done add thousands of dollars to your net
worth.
Don’t forget to check with your local utility company if you want to improve
the energy efficiency of your home. Most
offer an energy efficient mortgage program.
If purchasing a fixer-upper is what you looking to do. HUD has a 203(k) program designed to finance
both the purchase of the home and the remodel costs in one easy mortgage. Most mortgage lenders offer access to the HUD
203(k) program.