Personal loan or home improvement loan? That is the problem.
We like to decorate our house.
There are stages in our lives, maybe we spent too much time looking at food and food or TLC, so we built a castle in the air and turned our kitchen into a chef's paradise. Or according to our main bathroom is just a shower away from the disaster. Because we really like the Italian tiles in our bathroom.
If so, then cheer, you are not alone. Recently, the Harvard University Housing Research Center has investigated and reported that the home furnishing industry should continue to record record spending in 2016. For many people, this means borrowing money to pay for well-planned home improvement and home décor plans. .
Now, a person is bought to face a difficult, difficult, and sometimes hypothetical problem.
So, which home improvement loan is right for you?
Many homeowners and housewives want to take advantage of the assets in their homes. But for some borrowers, home equity loans or home equity credit lines may be impossible or very practical. In this case, you should consider using a personal loan.
Although it is well known that people can use personal loans for a variety of reasons, there are some reasons why personal loans can outperform home equity loans in terms of renewal loans, specifically.
The application process for personal loans is usually very simple and very simple. Your own financial situation – for example, your credit history and perceived ability; this is usually the main determinant of whether you can get a loan, the exact amount, and if so, at what rate. Some personal loans even boast that there is no original fee.
However, on the other hand, home equity loans or home improvement loans are similar to applying for a mortgage [in fact, home equity loans are sometimes referred to as second mortgages]. How much you can borrow depends on several factors, including the value of your home. Because you can only borrow the benefits you already have [that is, the difference between your home value and your mortgage], you may need to arrange – and pay – a home assessment.
Let us now look at the housing improvement loan situation. With a home equity loan or a home improvement loan, you can only borrow the equity you own – as a new homeowner, there may not be much. You may not have enough time to cut your mortgage, and the market has not raised the price of your home. No matter how much equity you have, personal loans can help you start a home improvement. Therefore, this is a benefit of using housing to improve loans.
With a home equity loan, you use the home as a mortgage, which means that failure to repay may result in foreclosure of your home. While failing to pay for your personal loan can be risky [such as damaging your credit and credit score], it is not tied directly to the head, like a gun on your head. Therefore, using personal loans is better and safer.
So, if we decide which one is better, safer and more appropriate?
Personal loans may not be suitable for every borrower seeking a home improvement loan. For example, if you have a large equity at home and want to borrow a lot of money, you can save money by lowering the interest rate on home equity loans. In addition, in some cases, interest on home equity loans and credit lines can be tax deductible; however, personal loans are clearly not the case.
On the other hand, personal loans make sense for these types of customers: –
• The nearest buyer.
• Small home renovation loans [for example, bathroom or kitchen instead of full renovation]
• Borrowers in lower home value markets [if your home value has barely changed since it was moved in, you may not have much equity available for home equity loans].
• For those who value easy and fast.
• Borrowers with good credit and cash flow.
While home equity loans and credit lines are a good source of home renovation funds, if you have established equity at home, if you are a new homeowner and need to take care of a home loan, a personal loan may be a better option. Some updates make your new home just right and perfect.
Finally, we conclude that personal loans are a better option than housing improvement loans.