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Home improvement loan – an easy way to enhance the value of your home

Posted by atreyee on April 3, 2009

A home improvement loan is specifically designed to provide financial assistance to those individuals who look forward to renovate, refurnish, upgrade or remodel their houses at low interest rates. It is a kind of debt, where in the borrowers gets a certain amount from the lender and is required to pay back in a lump sum or in regular installments. The service that is provided to the borrower is usually based on a cost known as ‘debt interest’.

 

A home improvement loan serves many purposes. The primary benefit that one gets by obtaining a home improvement loan is tax deduction. Moreover, it improves the quality of the home and increases its future value.

 

The cost of home improvement projects vary according to an individual’s capacity; similarly the amount of home improvement loans is decided upon by the person and is completely taken on the basis of which portion of his/her house s/he wants to renovate. Accordingly, the amount increases or decreases. The expense of a home improvement loan can either be paid out of savings account or by availing other kinds of loans, namely store cards or credit cards. The later ones can prove to be quite a pinch on the borrower’s pocket if s/he fails to repay the amount on time. The interest charged on store cards can range as high as 25%-30%, whereas the credit card interest rates hit 15%-18%, which is also on the higher side. Another option that home improvement loan borrowers often avail in funding their home improvement projects is personal loan.

 

There are some home improvement projects, which fail to get accommodated within the savings account, credit card or score card balance. In that case, the borrowers can opt for refinancing their home improvement loan or opt for further advance on a mortgage. They can even opt for unsecured loan with a variable rate of interest, or an unsecured loan, which offers a flat interest rate.

 

With a plethora of options available in home improvement project loans, you can multiply the value of your home within a short span.

 

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