Home Equity & Home Improvement Loans (1)
What you probably don’t realize is that there are a number of lenders who offer bad credit home improvement loans, which use the equity of your home or other real estate to determine the amount of the loan with no additional collateral needed. A. The current mortgage rate for a home loan refinance is in the mid 6s. If your current interest rate on your first mortgage is less half a point lower than that, then, by all means, refinance your first mortgage, pull cash out of your home and begin your home improvement.
The bottom line: While private-label credit cards issued by major home improvement stores like Home Depot, Menards, and Lowes may seem like a convenient way of financing your renovation project, you could easily end up paying through your nose for the convenience.
You will be qualified for the loan using the same criteria as other lenders, but because the state is a direct lender and they service the loans they make, they are able to give every veteran extra consideration, and if you qualify for a loan you get the same rate as everyone else.
This makes it a compelling choice if you’re embarking on a long-term home renovation and you aren’t sure exactly how much money you’ll need or when you’ll need it — contrast this with personal home improvement loans and home equity loans that pay out a lump sum.
One online lender offered me an interest rate that was a little lower than the credit union, but they also wanted a second mortgage on my home (the credit union didn’t) and the payments would be very difficult to meet because they only wanted to finance the loan for seven years (the credit union offered ten).