4 Ways to Finance Your New Roof Replacement
Tuesday, September 15, 2020, 6:00 PM | Leave Comment
A roof that is in bad shape can have you facing an expensive repair.
With the cost of a new roof at around ten thousand dollars, the average person does not have that type of money in their checking or savings account.
New roofs are costly and unexpected, but there are ways to finance your new project without a substantial financial burden.
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Apply for a Personal Loan
Personal loans are a good option for home improvement projects since interest rates are usually lower than credit cards. You’ll be given a large sum of cash, and work with your financial institution to repay the loan in monthly fixed amounts. These types of loans are also unsecured, meaning that you won’t need any collateral. A strong credit score is helpful, but there are options if your credit isn’t the best.
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Contractor Financing
Many roofing companies offer in house financing to make replacement more affordable. Since the company will want to earn your business, you can usually negotiate the terms of the loan. You’ll usually get better rates since the lenders finance a lot of loans with roofing contractors. This option is suitable for lower credit scores or a smaller home equity value.
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Home Equity Loans for Residential Roofing
You can tap into your home equity for your next residential roofing project. Equity is the current value of your home, minus the amount that you own on your mortgage. Home equity loans have lower interest rates, but you’ll need to keep up on your payments. Borrow just enough to cover the replacement to keep your fees affordable. Residential roofing costs are on the higher end of home repairs, making home equity loans a viable option.
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Credit Cards
Credit cards are better for stronger credit scores. You may qualify for a 0% annual percentage rate (APR) and a higher limit compared to a personal loan. The promotional APR typically lasts for 12-15 months, meaning that you’ll need to make sure you pay the balance off in full before the promotional period ends to avoid interest charges. Credit cards with high-interest rates should be your last resort.
The cost of a new roof can be staggering, but it can be affordable with many different financing options. All of your choices will allow you to pay for it in chunks instead of all at once. Consider the terms of your loan, interest rates, and your monthly budget before you decide what option is best for you.
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Rachelle Wilber is a freelance writer living in the San Diego, California area. She graduated from San Diego State University with her Bachelor’s Degree in Journalism and Media Studies. She tries to find an interest in all topics and themes, which prompts her writing. When she isn’t on her porch writing in the sun, you can find her shopping, at the beach, or at the gym. Follow her on twitter and Facebook.
