As a homeowner, you may be considering a home equity loan as a way to secure a home renovation loan or tap into your home equity.

A home improvement loan can be a great way to finance items on your renovation wishlist like a kitchen remodel or bathroom renovation. 

Every month, as you diligently make your mortgage payment, you might find yourself wondering when you will truly get to enjoy the major financial perks of homeownership - having funds.

HELOC and Home Equity Loans are considered the smartest way to pay for home improvements like a bathroom remodel, kitchen renovation, or home additions. Often homeowners use HELOCs to finance major renovation projects, as the interest rates are lower than they are on personal loans and credit cards. That’s because you can continually build equity as you live in your home and then access your home equity when you need it with a home equity loan or HELOC.

If you’re reading this article, someone probably told you the best way to finance your home renovation is with a construction loan. Sorry, but to put it bluntly, you’ve been given bad advice!

If you’re looking for the right way to pay for your home renovation, there’s a chance that you’ve been recommended a number of different options.

Many homeowners are taking on home renovation projects, and a significant portion of these homeowners financed these projects with home equity loans and HELOCs. What you may not realize is that the interest you pay on these loans might be tax deductible. 

When it comes time to begin a large home renovation project or even buy a new home, suddenly a lot of new terms come into play. From LTV to DTI to APR, learning all of these abbreviations at once can get confusing. But when you break them down, they’re not that complicated.

Your loan-to-value (LTV) ratio is really a comparison of your loan and your home, but it’s also one of the main factors your lender will consider when deciding whether or not to approve your loan application.

Whether you’ve fallen in love with a fixer-upper or have a list of renovations that you want to do to turn your current home into your forever home, there’s a good chance you’re going to need to borrow money to make this a reality.