Can I remortgage to make home improvements?
Deciding to make improvements around the house is the easy part. Deciding how to pay for them can be the difficult part. Home improvements can be costly, depending on how much you intend to improve on your home. Updating your home is a great investment, whether you are simply looking to enjoy the space you are in or you are looking to sell your home. Thankfully, there are plenty of ways to finance costly home improvements, and remortgaging your home is one of those options.
How does remortgaging your home work?
When you refinance your mortgage, you are essentially swapping out your current mortgage for a new one that will also give you a new interest rate. The great thing about remortgaging your home is that any differences between the old loan and the new one can be pocketed. That means that you can use that extra money to do your home improvements. That is only if the new loan is bigger than the one you already have. This option is called a cash-out refinance.
Is remortgaging the right choice for you?
Before you hop into another home loan, make sure you know of all the pros and cons that come with refinancing your mortgage. You will likely have to pay for things like an appraisal, origination fees, property taxes, and other taxes, as well as other closing-related fees and costs. You may also run the risk of lengthening out your loan, meaning it will take you longer to pay it off.
How else can you find home improvements?
If remortgaging doesn’t feel like the best option for you, you could consider funding your home improvements another way. Some home owners find ways of funding through their personal savings or by using a credit card with a low APR rate. It’s worth considering all available options to find the one that suits you best.
Here to help with your home improvements
All in all, remortgaging your home to make those necessary home improvements is a good idea, just make sure that you are able to secure a lower interest rate than what you are paying now. If you don’t, you may be putting yourself in an uncertain situation.
If you’d like to talk to us about improving your home, our experts are on hand and ready to help. Get in touch online or give us a call on 01252 370917. We would also love to welcome you into your local Sherborne showroom and introduce you to our product range.