When we have a property home, surely at some point we must carry out a reform of the property. Although it is a second-hand home we will have to reform it before moving to it or renting the house if it is not in the right conditions. And if the house is new we must take into account that after the years we must also reform it to keep it in good condition. In any case, requesting loans for the reform of your home is the order of the day and we explain the characteristics of this type of financing.
Almost half of people believe that housing reform is the main reason to apply for a personal loan or a mortgage loan . We tell you all the details:
When to request financing to renovate your home?
As we explained in the previous paragraph, whether we have a new or a second-hand home, it is likely that at some point we will need to carry out some reform. We can have several reasons to apply for a loan to renovate our house:
Old housing and we need to reform it
Increase the energy efficiency of the home (insulation, window changes, etc.)
Reorganize the available space (the family grows or decreases)
Reform the most punished areas such as kitchen and bathroom
Solve problems (pipes, damp, seepage)
Complex installations (underfloor heating, etc.)
Changes in the furniture of the house
In any of these cases a work is required, either of a minimum size or a comprehensive reform. And sometimes they come so surprise that we have no liquidity to face the expense of this reform. Or we simply prefer to apply for a loan to pay for the reform in a more relaxed way.
Types of home renovation loans
Precisely for all that, for 46% of people, housing reforms are the main reason for requesting a loan. And if we look at the amounts requested for the housing reform loan, it varies from USD 500 to USD 60,000. A fork large enough to be considered a micro-loan, personal loan or even a home equity loan.
Depending on the type of reform you will need one type of loan or another . We tell you what type of financing they need according to the amount of money you need:
Micro loans and personal loans could be considered from approximately USD 500 to USD 60,000. Always depending on the entity to which we are going for the request.
Home equity loans such as those offered reach up to USD 500,000 or up to 60% of the value of your home. In this case a mortgage loan to reform homes would be ideal if you need a large amount.
Requirements to request financing to renovate real estate
The requirements to apply for and grant you a loan for reforms will depend directly on the bank with which you reach the agreement. There are more requirements and conditions when requesting financing, other more lax in this regard. And always depending directly on the amount you are going to request.
Yes, we can identify a series of common requirements when requesting a loan to reform a home , when requesting a micro loan or a mortgage for this type of purpose.
Be of age
Present the ID or residence card
Last payroll of the holder to verify income (for micro loans sometimes it is not necessary if the amount is very low)
Last Income Tax Return
Proof of the project to be carried out in housing, delivery note or budget (for specific loans for reforms)
These are usually the requirements to request loans for reforms, but some entities may also ask us for additional documents. To give some examples: receipt domiciled in the name of the applicant or a photocopy of the bank book to certify that the account is from whom the money is requested.
Financing interests for reforms
Each loan and each entity is a world, so the interests will depend on the type of financing you choose and the entity in question. Although generalizing loans for the reform of homes and real estate usually have a fixed interest rate.
Although this interest is always set by the financial institution that lends you the money, you will surely find higher and lower interest rates. Look at this feature before applying for your personal loan to request the one that suits you best or the one with a low interest rate.
Commissions on financing for reforms
Most of these types of loans are associated with an opening commission and another cancellation commission , at the beginning and end of the loan payment respectively.
This fee or commission may vary greatly from one entity to another. We can even find banks or entities that lend money without charging these fees. Look and find out about commissions on reform loans before signing anything.
Amortization of loans for reforms
The repayment of the loan or the repayment of the loan to the financial entity can be negotiated from the beginning. Smaller loans can be repaid from a few months to a few years. While for depreciation of larger amounts the time can be years.
On average we can say that they do not usually exceed 10 years of repayment for reform loans . And it is always done through fixed monthly installments. In any case, we can always renegotiate the loan and installments by speaking directly with the financial institution.
Other services and insurance associated with these loans
Sometimes we may find that the application for a home renovation loan is associated with home insurance or life insurance . In these cases, it usually provides additional guarantees to the loan user. If this type of additional products suits you, ask the entity that lends you the money to know the options they have.
How to apply for a loan to make reforms at home?
In summary, requesting a loan to make reforms in your home is as easy as requesting information on our platform. as easy as applying for a loan to finance trips or credits for going back to school. We collaborate with dozens of entities and advise you for free on those products that fit your needs.
If you are looking for a reform loan, we will analyze your case to recommend the best loan of this type quickly and without obligation .