Renovation Loan Vaughan
For many homeowners in Vaughan, this will be the year that they make some much needed or much desired upgrades to their homes. Contractors across the city are busy giving quotes for everything from finished basements, to new roofs, to total home transformations.
And while such upgrades can dramatically improve the functionality and even the value of a home, they do come at a cost. The price of materials has gone up considerably over the last year. So how can homeowners in Vaughan pay for these upgrades? One option is to get a home renovation loan.
What is a home renovation loan?
Just like the name would suggest, a home renovation loan is a loan that allows you to finance a home renovation. And while this could technically be any type of loan, it is very commonly a loan that is secured using your home’s equity (often in the form of a second mortgage or home refinancing).
Using your home equity to fund a home improvement makes sense on a number of levels. For starters, this type of loan usually comes with a low interest rate. And secondly, since home improvements can actually increase the value of your home, using your home equity to pay for such improvements is a natural fit.
Why should you choose a Renovation Loan in Vaughan?
Home renovations can be a smart investment for any Vaughan homeowner. Not only can they help you to enjoy your home more fully (such as helping you get more use out of your kitchen or addition extra living space), but when the time comes for you to sell your home, you may find that these improvements will actually help you get a better price.
While there are a number of ways that you can finance your renovations, getting a renovation loan may be your best option. It is certainly a better option than using an unsecured loan such as a personal line of credit or a credit card since a renovation loan can save you a substantial amount of money on interest payments.
In some cases, getting a home renovation loan may even be a better option that funding the project yourself. If for example, you have enough money in your TFSA and are making a good return on your investments, it may make more financial sense to leave your own money where it is and get a low interest renovation loan.
How to get the best rates for Renovation Loans in Vaughan
While the rates on renovation loans are usually quite good, if you want to make absolutely sure that you are getting the best rate, then your first order of business should be to contact your mortgage broker.
Your mortgage broker will not only make sure that you get the best type of renovation loan to suit your circumstances, they will also shop around through their network of lenders to help you find the best interest rate.
They can often access rates that are even lower than a lender’s advertised rates, so you may still do better working with a broker even if you are willing to shop around yourself
How to get a Renovation Loan in Vaughan?
Getting a renovation loan in Vaughan is easiest when you work with a broker. When you have made up your mind that you would like to apply for a home renovation loan, your broker will sit down with you and review your situation. Some of the factors that they will consider will include:
- Your credit score.
- How much you still owe on your mortgage.
- Your mortgage renewal date.
- How much equity you have in your home. (Depending on how much you wish to borrow, a home appraisal may be required).
Based on their findings, your broker will recommend the best type of renovation loan for you and then shop on your behalf through their network of lenders to help you get the best rate. .
At the same time, your broker will ask you to gather various documents such as proof of income and statements showing your assets and liabilities. Once you have gathered the necessary documents, your broker will help you with the application itself and make sure that everything is completed according to the lender’s requirements.
Advantages of Using a Mortgage Broker for Renovation Loan
While getting a renovation loan without a mortgage broker is technically possible, there are so many advantages to working with a broker that it is a mystery why anyone would want to do this on their own. Some of the advantages of working with a mortgage broker include:
- Advice on the best type of renovation loan to get for your situation.
- Help in securing the lowest possible rate on your renovation loan.
- Guidance on what documents to collect, and if necessary, assistance in getting a home appraisal.
- Someone who can help you with the application and answer any questions that you may have.
Contact us today!
If you are a Vaughan homeowner looking for a renovation loan, give us a call today to speak with one of our brokers.