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Your Finance Options For Home Renovations

Depending upon the extent of home renovationequity. Apart from the availability of the
that you wish to carry out in order torequired amount of finance, you would stand
upgrade your home, you would need varyingto gain considerably if the current interest
amounts of finance. On the whole, it is quiterates are less than what they were when you
expensive to carry out any type ofhad  originally  taken  the  mortgage.
renovation, especially because it is a labor
intensive work. Before you think of4) Home equity: If you have enough equity you
renovating your home, you should make ancan opt for a home equity line of credit for
estimate of how much it would cost you andyour home renovation. Since this a secured
how you can arrange for financing the homeloan, the interest rate will be low and the
renovation  project.interest will be tax deductible. You can also
take home equity loans which are
Common  Financing  Optionscharacterized by fixed interest rates and
monthly payments and preset amounts of loan
1) Personal Savings: If you are averse tothat  can  be  taken  only  once.
taking any kind of loan, you can start saving
money and in a few years time you might be5) Homeowner loans: These loans are available
able to save enough to pay for the homeeasily and they are sanctioned on the basis
renovation work. While this might appear toof your income, irrespective of the equity
be a judicious decision, your project of homethat you have. These are secured loans and as
renovation could get delayed by many yearssuch  they  are  tax  deductible.
too. Moreover, this delay might push up the
cost due to inflation and you would be6) Value-added loans: The increased value of
deprived of staying in your dream home foryour home after the home renovation is done
several years. In case you already have theis the criterion for this type of loan which
funds, you should consider the returns thatis granted up to a maximum of 80% of the new
you can get on your money and the need tovalue of your home after the renovation. The
keep it for emergency situations in yourinterest rates are very competitive and the
life.payments are released progressively based on
the  amount  of work that has been completed.
2) Credit cards: This is a very convenient
way of arranging for finance but theAlthough secured loans offer easy loan terms
disadvantage is that it carries a very highand interest rates and are tax deductible,
rate  of  interest.you must make sure that you make the
repayments on time as per the agreed schedule
3) Refinancing: You can refinance thebecause failure to do so might mean losing
mortgage of your home to get finance for theyour home.
home renovation work if you have sufficient



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