U.S. Markets closed

How to Get a Home Improvement Loan

Gary Wilkinson

If only home improvement projects were as easy as they look on HGTV shows, then your primary concern would be whether the design recommended to you by the renovation company meets your expectations. Unfortunately, only a few people get an opportunity to appear on the shows and so they do not provide a true picture of a home improvement project.

Banks make it possible for thousands of people from all across the globe to make their homes better by providing home improvement loans. Applicants can use the credit to pay contractor fees and purchase the materials required for the project.

However, there is no guarantee that the bank will approve your application. There is a set of factors that are used to determine if an application is feasible. Here are proven tips on how to get a home improvement loan.

Evaluate your Equity

Most of the loans are dependent on the homeowner’s equity, which is the portion or percentage of the home that is already paid for. Home equity is used as collateral for the loan, but that is usually not enough to prove to the bank that you can repay the loan. You need to demonstrate beyond any reasonable doubt that you have the financial capacity to repay the loan and all existing debts on time. Once you do that, the final terms of the loan will be drafted, and you will be requested to read the document before signing it.

Note that the signed document can be presented in a court of law as evidence if you fail to repay the loan or any other tussle that requires the interpretation of the stipulated laws arise after you are awarded the credit.

Know your Credit History

Have you being repaying existing loans or debts? All the information about your past loans is captured and compiled by the credit bureaus. Whenever you apply for a home improvement loan, the bank will request for your credit report from the bank to evaluate your application.

A low credit score may result in your application being denied. The score is also used to determine the amount of money that should be loaned to you as it highlights your financial stability and ability to repay the loan. Other terms and conditions can also be based on the score.

Based on the above facts, you should strive to improve your credit score to increase the chances of your loan application been approved. A high credit score will also help you to get better terms and more capital to support the renovation project.

If you have a low credit score, you can still apply for a government loan or approach private lenders who are known for providing financial assistance to persons who have less than desirable credit score. Repaying the loan on time and abiding by all the terms and conditions will positively influence your credit score thereby increasing your chances of getting a loan from the bank.

Get An Appraisal

As mentioned earlier, home equity is used as collateral by most lenders. The bank will evaluate the total value of your home before deciding to either approve or reject your application. They will also use the value to know the ideal amount of money to loan you.

Getting an appraisal will prepare you well for the process. For example, the results of the assessment will also help you to know the amount of money that you should quote in your application.

Estimate the Total Cost of the Project

How much is it going to cost to replace the current roof, install solar panels, or redesign your kitchen? Consult contractors to get an estimate of the total cost of the renovation project before filling the loan application documents. You should get estimates from professionals who have been in business for a while now to avoid under or over-quoting.

You may encounter roadblocks along the way that will force you to spend more money than what you had indicated in the budget. Therefore, it is wise to make sure that you factor in such unforeseen expenses in your budget to avert financial challenges.

More importantly, the estimates will help you to know if you can use a portion of your savings to pay for some of the renovations in cash. This could reduce the loan amount that you need and save you money in the end.

Conclusion

Contact Get Hearth to get more advice on how to get a home improvement loan. This team of experts will evaluate your expectations, financial capability, and the various financing options available to help you make the right decision. They can also give you additional tips on how to manage and keep track of expenditure as the project progresses.

See more from Benzinga

© 2017 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

  • Business
    Barrons.com

    Barron’s 10 Stock Picks for 2020

    The stock trades for 25 times projected 2020 earnings of $55 a share. But the effective P/E ratio is closer to 20 after adjusting for the losses in Alphabet's “other bets” businesses, like Waymo, the leader in autonomous driving technology, and net cash of $117 billion. Alphabet's revenues have regularly grown at a 20% quarterly pace, while Apple's sales fell in its latest fiscal year.

  • Boeing board meets as company considers 737 MAX production changes
    Business
    Reuters

    Boeing board meets as company considers 737 MAX production changes

    Boeing Co is considering whether to cut or halt production of its grounded 737 MAX after the Federal Aviation Administration said last week it would not approve the plane's return to service before 2020, a person briefed on the matter said on Sunday. The largest U.S. planemaker's board of directors is holding a regular two-day meeting in Chicago starting Sunday and the company could make an announcement on production plans as soon as Monday, the person said. The Seattle Times reported Sunday the board is considering a proposal from top management to temporarily shut down 737 production.

  • Dow Jones Futures: After China Trade Deal, Which Sectors Will Lead Stock Market Rally?
    Business
    Investor's Business Daily

    Dow Jones Futures: After China Trade Deal, Which Sectors Will Lead Stock Market Rally?

    Dow Jones futures rose modestly Sunday night, along with S&P 500 futures and Nasdaq futures. The stock market rally hit record highs last week as President Donald Trump finalized a China trade deal with Beijing. Clearing up that uncertainty is good news for current winners such as Apple stock and AMD stock.

  • The Comstock Resources (NYSE:CRK) Share Price Has Gained 26% And Shareholders Are Hoping For More
    Business
    Simply Wall St.

    The Comstock Resources (NYSE:CRK) Share Price Has Gained 26% And Shareholders Are Hoping For More

    Some Comstock Resources, Inc. (NYSE:CRK) shareholders are probably rather concerned to see the share price fall 35% over the last three months. In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

  • Here’s the formula for paying no federal income taxes on $100,000 a year
    Business
    MarketWatch

    Here’s the formula for paying no federal income taxes on $100,000 a year

    The question of how much can we earn without paying federal income taxes is relatively easy to answer for most people. The standard deduction for a married couple is $24,400 in 2019 (if both are under 65 years old), and the top of the 0% capital-gains tax bracket is $78,750. With our daughter, we also qualify for the child tax credit ($2,000), so we could actually generate another $13,333 per year in dividends or capital gains, taxed at 15%.

  • Have Insiders Been Buying Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN) Shares?
    Business
    Simply Wall St.

    Have Insiders Been Buying Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN) Shares?

    So we'll take a look at whether insiders have been buying or selling shares in Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN). Do Insider Transactions Matter? It's quite normal to see company insiders, such as board members, trading in company stock, from time to time.

  • The CVR Energy (NYSE:CVI) Share Price Is Up 96% And Shareholders Are Holding On
    Business
    Simply Wall St.

    The CVR Energy (NYSE:CVI) Share Price Is Up 96% And Shareholders Are Holding On

    But over three years, the returns would have left most investors smiling In the last three years the share price is up, 96%: better than the market. While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

  • News
    Reuters

    German union calls for pre-Christmas Amazon strike

    Trade union Verdi called for workers at a key Amazon logistics centre in Germany to go on strike over the crucial final shopping days before Christmas, demanding better pay and conditions for workers there. Unions have staged repeated strikes in Germany, Amazon's second-largest market after the United States, since 2013, hoping to force the retail behemoth to recognise collective bargaining agreements that apply to other retail employees. "Verdi wants to use the high-turnover days before Christmas to raise the pressure for collective wage bargaining at Amazon," the union said in a statement on Sunday, saying that staff Christmas bonuses should be quadrupled from their current level of 400 euros ($441).

  • Is Viking Therapeutics, Inc. (VKTX) A Good Stock To Buy?
    Business
    Insider Monkey

    Is Viking Therapeutics, Inc. (VKTX) A Good Stock To Buy?

    Is Viking Therapeutics, Inc. NASDAQ:VKTX) ready to rally soon? Investors who are in the know are in a pessimistic mood.

  • Teens arrested in weekend mall shooting
    U.S.
    Associated Press Videos

    Teens arrested in weekend mall shooting

    Police say they have arrested two teenagers in connection with a shooting that wounded one man in a busy suburban Atlanta mall food court in the height of the Christmas shopping season. Dec.

  • Business
    GuruFocus.com

    Apple Is a Great Company With a Dubious Valuation

    AAPL 30-Year Financial Data The intrinsic value of AAPL Peter Lynch Chart of AAPL As I discussed in a previous article for GuruFocus, Apple's growth over the past decade has been fueled in large part by the exceptionally popular iPhone smartphone platform. As mobile saturation has gradually gone global, opportunities for market expansion have petered out. Consequently, Apple has found itself in need of new growth drivers in order to keep its narrative - and high-flying share price - alive.

  • Does American Airlines Group Inc. (NASDAQ:AAL) Have A Good P/E Ratio?
    Business
    Simply Wall St.

    Does American Airlines Group Inc. (NASDAQ:AAL) Have A Good P/E Ratio?

    This article is written for those who want to get better at using price to earnings ratios (P/E ratios). To keep it practical, we'll show how American Airlines Group Inc.'s (NASDAQ:AAL) P/E ratio could help you assess the value on offer. What is American Airlines Group's P/E ratio?

  • 3 Stocks With Fast-Growing Earnings
    Business
    GuruFocus.com

    3 Stocks With Fast-Growing Earnings

    The S&P 500 Index has grown its annual earnings per share (not adjusted to the inflation) by 41% over the past fivr years (about an 8.2% increase every year), pushing the share price up 53% to $3,168.80 at close on Friday. While past performance is not a guarantee of future results, if you choose companies that have reported more than 41% growth in their annual earnings per share, topping the S&P 500 over the observed period, your search may uncover good performers. GuruFocus has detected 6 Warning Signs with NVDA.

  • Business
    GuruFocus.com

    Top Insider Buys Highlight for the Week of Dec. 13

    MDT 30-Year Financial Data The intrinsic value of MDT Peter Lynch Chart of MDT Medtronic is an international medical instrument company headquartered in Dublin, Ireland, with their operational headquarters in Fridley, Minnesota. It is one of the world's largest medical equipment development companies, with operations in more than 140 countries. The company has a market capitalization of $152.16 billion; as of Dec. 13, it traded at $113.52.

  • Did General Dynamics's (NYSE:GD) Share Price Deserve to Gain 28%?
    Business
    Simply Wall St.

    Did General Dynamics's (NYSE:GD) Share Price Deserve to Gain 28%?

    Furthermore, you'd generally like to see the share price rise faster than the market Unfortunately for shareholders, while the General Dynamics Corporation (NYSE:GD) share price is up 28% in the last five years, that's less than the market return. Over the last twelve months the stock price has risen a very respectable 6.0%. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

  • The No. 1 highest paid, most in-demand jobs in every U.S. state for 2019
    Business
    MarketWatch

    The No. 1 highest paid, most in-demand jobs in every U.S. state for 2019

    Software developers, physical therapists and physician assistants crop up frequently among the highest-paid and fastest-growing jobs in every U.S. state, according to a recent analysis by CareerBuilder, a jobs and careers site. The site analyzed government data to project the careers most likely to be lucrative and in demand. Most of these jobs require some level of college education.

  • With Miss Jamaica's Miss World Win, Black Women Now Hold Five of The World's Biggest Beauty Pageant Titles
    News
    Meredith Videos

    With Miss Jamaica's Miss World Win, Black Women Now Hold Five of The World's Biggest Beauty Pageant Titles

    Black women currently hold five of the biggest beauty pageant titles in the United States, and the world.

  • Citigroup (NYSE:C) Shareholders Booked A 41% Gain In The Last Five Years
    Business
    Simply Wall St.

    Citigroup (NYSE:C) Shareholders Booked A 41% Gain In The Last Five Years

    Better yet, you'd like to see the share price move up more than the market average. Unfortunately for shareholders, while the Citigroup Inc. (NYSE:C) share price is up 41% in the last five years, that's less than the market return. While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance.

  • Is iRobot Corporation (IRBT) Going To Burn These Hedge Funds ?
    Business
    Insider Monkey

    Is iRobot Corporation (IRBT) Going To Burn These Hedge Funds ?

    The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. The following article will discuss the smart money sentiment towards iRobot Corporation (NASDAQ:IRBT).

  • Hey, good news America: Investors are bailing on stocks
    Business
    USA TODAY

    Hey, good news America: Investors are bailing on stocks

    Despite 2019 turning in the strongest year for stock investors in the last six, investors have been selling stock mutual funds at a record pace. So far, equity mutual funds and exchange-traded funds have lost over $135 billion to withdrawals – the largest amount since Refinitiv Lipper began tracking the flows in 1992. While the market has continued to power forward and investors have been exiting equity investments, cash on the sidelines has risen.

  • Costco Wholesale Corporation Just Beat EPS By 11%: Here's What Analysts Think Will Happen Next
    Business
    Simply Wall St.

    Costco Wholesale Corporation Just Beat EPS By 11%: Here's What Analysts Think Will Happen Next

    Earnings are an important time for investors, as they can track a company's performance, look at what top analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent forecasts to see whether analysts have changed their earnings models, following these results. After the latest results, the 23 analysts covering Costco Wholesale are now predicting revenues of US$163.0b in 2020.

  • Politics
    Bloomberg

    Lighthizer Scores Trifecta of Wins for Trump’s Trade Agenda

    It's almost like Christmas came early for U.S. Trade Representative Robert Lighthizer. Last week, he delivered on two of President Donald Trump's most important economic priorities after months of tense discussions, and notched a win far from Washington on an issue of global importance that he himself had angled to get for decades. Within days, the trade representative announced an agreement with House Democrats on the renegotiated North American Free Trade Agreement, finalized the terms of a partial deal with China and brought to a standstill the appeals process at the World Trade Organization.

  • 3 Stocks to Enhance the Quality of Your Portfolio
    Business
    GuruFocus.com

    3 Stocks to Enhance the Quality of Your Portfolio

    ASML has a current ratio of 2.72, which is better than the industry median of 2.26. The current ratio is ranked higher than 59.7% of a total of 814 competitors operating in the semiconductors industry. The GuruFocus chart below shows that the trailing 12-month working capital was $7.67 billion and the trailing 12-month long-term debt was $3.44 billion as of Dec. 12, 2018.

  • Key Things To Consider Before Buying CenterPoint Energy, Inc. (NYSE:CNP) For Its Dividend
    Business
    Simply Wall St.

    Key Things To Consider Before Buying CenterPoint Energy, Inc. (NYSE:CNP) For Its Dividend

    Today we'll take a closer look at CenterPoint Energy, Inc. (NYSE:CNP) from a dividend investor's perspective. Unfortunately, it's common for investors to be enticed in by the seemingly attractive yield, and lose money when the company has to cut its dividend payments. Explore this interactive chart for our latest analysis on CenterPoint Energy!

  • What Does Fifth Third Bancorp's (NASDAQ:FITB) Share Price Indicate?
    Business
    Simply Wall St.

    What Does Fifth Third Bancorp's (NASDAQ:FITB) Share Price Indicate?

    Fifth Third Bancorp (NASDAQ:FITB) received a lot of attention from a substantial price increase on the NASDAQGS over the last few months. As a large-cap stock with high coverage by analysts, you could assume any recent changes in the company's outlook is already priced into the stock. However, what if the stock is still a bargain?