%20(1800%20x%201200%20px)%20(300%20x%20300%20px)%20(4).png)
%20(1800%20x%201200%20px)%20(300%20x%20300%20px)%20(3).png)
Home renovation financing options
You have many options for financing home renovations, each with pros and cons.
Remember: It’s a good idea to set aside money for unexpected costs so you to adjust your plans without renegotiating your finances or reapplying for new funds.
Savings or a credit card
You may want to pay for the materials for smaller projects yourself so you can also use a credit card to cover materials. But be careful not to carry the balance for too long. Credit card interest rates can top 18%.
Personal loan
A personal loan has a lower interest rate than a credit card. You repay it in regular payments over a set period, usually 1 to 5 years. Once the loan is repaid, you can reapply to borrow more.
Personal line of credit
For ongoing or long-term projects. You can access funds as you need them, and you only pay interest on the amount you use. Interest rates for a personal line of credit are always lower than on a credit card. And unlike a personal loan, a line of credit lets you re-borrow funds, up to the line of credit’s limit, without reapplying.
Secured line of credit and home equity loan
These offer all the advantages of regular lines of credit and loans and come with preferred interest rates. But because they’re secured by your home’s equity, they are subject to set-up costs like legal fees.
Mortgage refinancing
Refinancing may offer some advantages when looking to do major renovations. You may access a better interest rate than on a credit card or loan. Repayment is spread over a long time period.
Financing upon home purchase
If you’re planning major renovations to a home you’re about to buy, consider adding the cost to your mortgage. You’ll pay a lower interest rate than with a credit card or loan.
Grant and rebate options for energy efficiency
Federal, provincial and municipal governments and local utilities may offer grants and rebates for energy-saving renovations.
· ENERGY STAR® rebates and incentives
· Extensive Home Improvement Project by RBC Bank
Financing an Extensive Home Improvement Project
Using your home equity is one of the most cost-effective ways to finance a large, extensive home improvement project. That's because home equity loans and lines of credit often offer a lower interest rate as compared to other types of loans.
We offer the following solutions:
Manage your mortgage and home improvement line of credit under one plan. You could qualify for this flexible financing option with a minimum of 20% equity in your home.
Access additional funds by simply adding them on to your existing RBC Royal Bank mortgage, based on the current appraised value of your home.
Consider a line of credit if your renovations will be done over time and you don't need all the money at once—or if you plan to reuse your credit after paying it off.
Refinance your existing mortgage and have up to 30 years to repay.
Making sure you have the right type of financing in place for a major renovation is important, so be sure to talk to an RBC Royal Bank credit specialist, who can recommend the best solution for your needs.
Financing a Mid-size to Large Home Improvement Project
If you are planning a mid-size to large home improvement project that will cost over $5,000, a line of credit or personal loan could meet your needs:
Consider a line of credit if your renovations will be done over time and you don't need all the money at once—or if you plan to reuse your credit after paying it off.
A personal loan could be ideal if you need the funds all at once and want a structured repayment plan.
Not sure which option is right for you? Talk to an RBC Royal Bank credit specialist, who can recommend the best financing option for your project.
Financing a Small Home Improvement Project
If your project is going to cost less than $5,000, you may want to consider using cash and/or a credit card to finance your project.
We offer a wide range of credit cards, including cash back, rewards, low interest rate and no annual fee cards.
Financing a Green Home Improvement Project
Whether you're adding a solar thermal system or switching to energy-efficient appliances, we have the financing solutions to make your green home renovations happen. You could even save money on a home energy audit or your loan.
Receive 1% off the loan interest rate or a $100 rebate on a home energy audit on a fixed rate instalment loan over $5,000 when you purchase eligible products or services.
Receive a $300 rebate on a home energy audit with this unique mortgage.
Manage your mortgage and home improvement line of credit under one plan. You could qualify for this flexible financing option with a minimum of 20% equity in your home.
Comments