6 ways to access funds for your DIY renovation
Home renovation is normally expensive, even if you decide to take on a DIY renovation project. Most of the time, you’ll be left scouring for cash to fund your project, and the amount you need will hugely depend on the scale of your renovation.
Fortunately, there are a few ways you can follow just in case you find yourself in a shortage of funding for your DIY renovation, and one of them involves fast cash loans. Check out the tips below as your complete guide:
1. Refinance Your Mortgage
Refinancing your mortgage allows you to save some extra cash, so you can pay for your future renovation project. You have the option of refinancing it at a lower interest rate, allowing you to reduce your monthly payment. Alternatively, you can also opt for a cash-out refinance. With this option, you can refinance your existing loan then save the extra amount which you can then use to renovate your house.
2. Apply for Short-Term Loans
Banks and other lending institutions offer fast cash loans with minimal requirements. Applying for this type of loan allows you to receive immediate financial help which is payable with interest in a span of 3 to 24 months. Typically, interest rates will vary depending on your current credit score and the amount you borrow. Once approved you can access these funds within a few hours which makes these an ideal option when you require fast cash!
Fast cash loans are easier to apply compared to traditional loans. Most of the time, you only need to maintain a good credit score although there are some that offer loans even if you have a poor credit rating.
3. Credit Cards
Using a credit card for your DIY renovation project is only ideal if you plan to undertake a really small project. That’s because the interest rates associated are often higher compared to mortgages. However, if you badly need funding for a really small project, then using credit cards won’t hurt.
In most cases, you’ll be dealing with a 15% interest rate (could be even more in most cases) until you can repay the amount borrowed. Due to its massive interest rate, it’s not a viable option if you plan to undertake a large DIY renovation project.
Crowdsourcing would help you generate the funds you need for your DIY renovation project. However, while it’s possible to gather funds through this method, it’s not a 100% guarantee.
You can advertise your crowdsourcing project on social media, and there might be people who will donate anonymously for your cause. Then again, it depends on your situation. Most of the time, people might be willing to donate if your house got wrecked following a flood or if you just got married and are financially lacking, although it really depends on the situation.
5. Apply for Home Equity Loan
Considered the most common method people use to borrow funds, applying for home equity loan provides the funding you need alongside low interest rates. However, to make your application successful, you need to have at least 5% equity, sometimes even 15-20%, and an excellent credit rating.
Though it’s a reliable means of obtaining funding, the downside is that your house will be used as collateral, so in the event you can’t repay the money borrowed, you’ll lose your house in a foreclosure.
6. Consider Peer-to-Peer Lending
Compared to traditional lending where you borrow money from a bank or financial institution, peer-to-peer lending allows you to borrow funds from individual investors through a peer-to-peer lending platform.
Most of the time, it involves relatively low interest rates and a lower barrier to entry. Also, similar to short-term loans, it’s quick and easy to process, and you don’t even need an excellent credit rating to qualify.
Although there are plenty of methods you can follow to obtain the funding you need for your DIY renovation project, still the fastest and easiest method of doing so is through fast cash loans. With this type of loan, you don’t have to undergo complicated processes that often take time just to borrow cash. Aside from that, the interest rates can be attractively competitive depending on the amount you want to borrow.