A Florida Home Improvement Loan? How to Finance a Fixer-Upper

You possess good credit. You wish to apply for a Florida home mortgage loan. But you can only afford a house in less than ideal condition. Or perhaps you wish to purchase an older piece of property in order to “flip” it for an investment.

Any of this sound familiar? Those contemplating home repairs/improvements/remodeling might not want to charge the money for costs on their credit card - minimum monthly payments and interest rates have been sky-rocketing.

Instead, consider a Florida home improvment loan or any of the following ways to tap into your existing equity in order to finance this fixer-upper:

Cash-Out Refinance
Receive cash from your home equity via Florida home loan refinancing for more than the balance you owe. For example, if your existing mortgage balance is $100,000, you could refinance into a new mortgage for $150,000. You still owe the $100,000, but you’d have another $50,000 to use for the home improvements.

Home Equity Loan
Apply for a second mortgage on top of your existing one. A Florida home equity loan supplies you with a lump sum of money that’s good to use for a one-time big expense. This is also a viable way to get cash from your home equity, especially if you’ve hired someone to do the repairs and plan to pay them all at once.

Home Equity Line of Credit (HELOC)
How about a home equity line of credit (HELOC). A HELOC is also a second mortgage, but instead of one lump sum of cash, it works more like a credit card, taking advantage of your equity as your line of credit. You can draw from it anytime you need to and pay it off as you use it.

Benefits of Using Your Home Equity
So, why should you access your home equity to get cash for a fixer-upper? Consider the following benefits:

1. The interest you pay on a Florida home equity loan is usually tax-deductible, unlike the interest on a credit card.
2. Moreover, the interest rate you could get on a Florida mortgage loan is lower than the rate you get on a credit card.
3. There are various ways to save. Thanks to many different loan options available these days - some with interest-only payments built into them - you’re only required to pay the interest portion of the monthly payment. This kind of flexibility could make it even easier for you to handle paying for those home repairs.

Remember: if your new house needs repairs, but you don’t have the money on hand, there are steps that can easily be taken. Don’t abandon your dreams - let us help!