Home improvement projects may leave your home in temporary chaos and disarray, but the process of obtaining a home improvement loan shouldn't. Since borrowing money means becoming a customer of a lender, you want the entire process to be in your best interest from start to finish. The following factors should be prime influences in helping you determine who your home improvement loan should be with.
The Strictness Of Your Eligibility
Depending on your credit score, a lender might make you jump through all kinds of hoops before considering you eligible as a borrower, and that should be a consideration when you're shopping for a home improvement loan. How easy will they make things for you? How long and tedious is the process? While you're not going to be able to find a lender that doesn't have a set criteria for eligibility, you do want to find one with a simple process you can get through with relative ease.
The Interest You'll Be Charged Over The Life Of The Loan
Interest should be a major consideration for you, regardless of your credit history or ability to repay. Getting a "fast and easy" loan might save you time and trouble; however, you could be stuck with a high-interest rate, if you're not careful. Read the fine print and ask lenders about competitive rates. Remember, too, that the longer the term of the loan, the more interest you're going to pay in the long-run, so if you can afford a slightly higher monthly payment, opt for shorter terms, to save a considerable amount in interest paid.
The Amount You're Allowed To Borrow
Before you apply for a home improvement loan, you'll need to calculate how much money is required to complete the project, then tack on a little extra, to cover just-in-case expenses. Even then, you might run into problems, such as discovering pipes that are so worn out they need replacement or running into underground obstacles if you're adding to your home's existing structure. While a lender will consider the loan-to-value ratio (where the amount of the loan is weighed against the value of your property or upgrades), you still want the flexibility that allows you to complete the plan to your satisfaction.
The Overall Experience
Researching lenders and applying for loans is no small task, nor is it usually the most enjoyable way to spend your time; therefore, you need to evaluate the experience a lender is likely to provide, from the time you first apply to the time you make your final payment on the loan. Good customer service can make the loan experience much smoother, easier to understand and far less stressful than if you can't get a human voice on the phone when you need one, don't understand the terms of a loan or otherwise have a need for assistance. Find reviews (of lenders) before deciding on one or ask people you know for their recommendations, based on the personal experiences they've had with a bank, broker or lender.
Being particular about the lending institution you borrow from is ultimately in your best interest, as you'll end up with the best terms and the best service. You'll have enough chaos and unpredictability to contend with as you undertake the home improvement project, so make sure the lending process is as dependable and convenient as possible.
For more information, contact your local home remodeling loans office.