Maine Home Performance Audits and Energy Improvement Loans

by Amanda Maseko

Any improvement of your home is going to cost a great deal of money and the vast majority of people find the only way they can afford to carry out work of this kind is to arrange a home improvement loan. If you want a first rate home improvement job carried out with a guarantee then you will need to use professional tradesmen who should also speed the work up a great deal.

Almost all homeowners are able to arrange a home improvement loan but some may decide voluntarily, or be forced, to have the loan secured on their home or other valuable possession. A loan that does not require equity allows new homeowners to apply even if they just bought their home. Finance which is used to improve the home is seen as a good investment in the property and even if equity in the property is not required, the loans can be organized for up to 15 years at a time.

The eligibility for finance without equity can depend on the combined household income, which should not exceed the county limit where the property is located. The loan process for people applying for a no equity loan is minimal even though the property and type of improvements planned are looked into.

The difference with a secured home improvement loan means the value of the property is taken into account so when there is spare equity, the loan is basically taken out of this. The upside to this type of secured loan is it’s available at more favorable rates of interest but is not arranged as a second mortgage on the property.

This is not an open ended finance agreement and a valuation of your property will be required for a secured loan to be arranged. All factors are considered before a final amount is agreed upon and that includes how much is owed on the mortgage, its current value and what other debts the owners may have.

All these factors will be considered for putting a loan package together for your consideration. Usually, finance companies will lend you a percentage of the assessed value of your house but some lenders can lend as high as 125 percent of your home’s equity.

An equity based loan can be risky if you arrange to lend an amount greater than you can comfortably afford so consider this carefully as you may end up handing your beautiful home over to your creditors. So when you arrange a home improvement loan, it is best to use it only for necessary repairs and make renovations or home additions only when you have the money to spare.

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