Some homeowners are able to pay out of pocket for a roofing project. Perhaps they’ve been saving up for the job for quite some time, or maybe they just came into some money and are using it to revamp their property. Whatever the reason, it’s not often that people can always pay for a new roof without some sort of financing or assistance.
However, homeowners shouldn’t have to wait until they can save up to make sure their roof is looking in tip-top shape. After all, not only does a new roof provide added curbside appeal, but it is also a crucial part of keeping the home secure and safe from bad weather. A roof in poor condition is susceptible to leaks—and in the worst-case scenarios—they can even collapse. That’s where roof financing options come in.
An excellent financing opportunity should be affordable, as well as easy for both the contractor and homeowner. There are some reliable options out there, so make sure you thoroughly look over them to decide which is right for you and your home.
Let’s get started! Here are 4 roof financing options for homeowners on a budget.
Using a Financing Provider Like Enhancify
Perhaps the best way to make sure your roofing project gets done on time without needing to wait to save up for more funds is through actual financing providers, such as Enhancify. Here’s how they work:
You’ll work with your contractor to submit an application using a portal that can be done fast, without the risk of missing important information. Next, you will see your rates (including 0% same-as-cash offers) from thousands of lenders. Then, you’ll just need to pick the option you like best, and that works for your situation. For financing providers that have their processes down like Enhancify, you’ll get money deposited into your account in as quickly as 24 hours. It’s that simple.
Typically, these providers will also have a knowledgeable and dedicated customer support team that will ensure that you are taken care of and that everything goes smoothly. For many homeowners, this is the obvious route to take for several reasons.
First, they are extremely fast, which means the project can get started much quicker than the other options on this list. Next, they are straightforward to use, and if you ever run into any issues, they are just a phone call away.
If you need financing for your next roofing project, we absolutely recommend taking a look at Enhancify. As one of the new kids on the block in the industry, they’ve been using cutting-edge techniques to streamline their process to get money into homeowners’ hands so that they can carry out their dream projects.
To learn more about Enhancify and whether or not they’ll be a good fit for your roof financing, make sure to bring them up to your contractor and send them here! You and your contractor should work together to find the best option for you, and if they are a quality, professional contractor, they should be willing to work with you to see what works.
Home Equity Loan
Next, homeowners can choose a home equity loan to help them pay for their new roof. A home equity loan can be a solid option for some people to pay for a new roof. To take a home equity loan, you’ll need to work with a bank. You’ll be using your home’s equity as collateral for the loan.
Here’s how it works in a basic sense: if you have a $300,000 home and owe $100,000, then your home equity is $200,000. The FTC allows homeowners to borrow up to 85% of their home’s equity. Therefore, someone with $200,000 in home equity could borrow up to $170,000.
Sounds pretty nice, right? Well, there are some cons that come with home equity loans. For example, because your actual home is being used as collateral, there are some pretty significant consequences for falling behind on your payments—such as losing your home altogether. Therefore, it’s important to only borrow what you need and not take any more than you know that you can pay back each month.
Personal Bank Loan Or Line of Credit
Some homeowners look to getting a personal loan or line of credit from a local bank or credit union. However, it can be difficult to know the difference between a personal bank loan and a line of credit. The main difference between the two is how you get the money and then how you repay said money. A loan is a lump sum of money repaid over a fixed term, whereas a line of credit is a revolving account that lets borrowers draw, repay, and redraw from available funds. While both are viable options for homeowners looking into financing for roof projects, loans are typically the better option.
As Value Penguin says, “In general, a personal loan is better for large, one-time investments or purchases. This could be the purchase of a new home or car or paying for a college education. On the other hand, lines of credit are better for ongoing, small, or unanticipated expenses or to even out income and cash flow.”
There are a few other reasons why some people like going the route of a personal bank loan as opposed to an actual financing provider. First, they feel like working with a local organization for their financing makes sense because they tend to trust them more. They also like that, because they are local, they think that they will get the money faster. However, this is often not the case. Banks can be extremely slow when it comes to loans, so you may be waiting for a long time to finally get the funds to pay for your new roof.
If you have homeowners’ insurance and you’re looking to repair a roof that is damaged, then you may qualify for your insurance covering all or some of the cost of your new roof. Here’s the catch, though; your roof must have been damaged by a storm, fire, or other cause under your insurance policy. For example, it’s likely that your insurance company won’t cover a replacement or repairs for a degraded roof because of its age or a lack of maintenance.
If you have had a storm that has caused damage in the past, it doesn’t hurt to call your homeowners’ insurance provider to see what exactly your policy is. However, this isn’t a viable option for many homeowners because, typically, the policies are quite stringent.
Those are 4 solid solutions for helping you pay for a roof when you’re on a budget. Are there any other methods that you use or recommend to finance a roof? Let us know in the comments about some of your success stories (or horror stories).