Renovations for adding value to your property
Renovating is a great way of adding value to your home. But like most creative projects renovating can be frustrating and stressful – that’s where a Loan Market mortgage broker can help in getting the right finance the first time.
Depending on the size of your renovation project, you could need anything from a few thousand to hundreds of thousands of dollars. If you already have an existing home loan then a Loan Market Mortgage broker will help you explore a number of competitive refinance options.
Renovations don’t always go smoothly, but we’ll make sure your finance loan does.
Before you get started on your project, you will need to consider the features on your home loan. To give you greater control over your renovation you can choose from a range of financing options.
Redraw facility for smaller projects such as a new bathroom or sun deck
A redraw facility allows you to access additional funds paid into your home loan if you need extra money, up to the amount of the additional repayments made. A redraw facility offers flexible access to funds when they are most needed.
Loan top ups for small to medium sized renovations
A loan top-up allows you to increase the credit on your existing home loan to fund your renovation. It essentially taps into equity you have already built up in your property and extends some of that amount back to you, avoiding the expenses associated with acquiring additional finance through other sources. Unlike an equity loan, you are generally not able to continue to draw your interest back up to an agreed level if you find you require additional funds you will need to apply for another top-up loan. There may be a minimum amount you can top-up, usually around $10,000.
For major work, such as a large ground floor addition, you could be looking at costs into the hundreds of thousands of dollars. Work on such a large scale may require separate finance in the form of a renovation or construction loan. These loans pay out funds for the construction or major renovation of your property in stages, rather than as a lump sum like a more traditional residential home loan.
Equity loans for medium sized projects such as a kitchen or pool
Equity loans allow you to access the equity in your property to fund your renovation project. The amount you can borrow is subject to the amount of equity you have built up in your property and other serviceability criteria, but as a guideline, even if you own your home outright you are likely to be limited to borrowing a maximum of 80% of the value of your property.
A Loan Market mortgage broker will help you assess and negotiate fees and will help you source a competitive loan. For more information on financing a renovation or the home loan that is in your best interest,talk to your local mortgage broker or call us at any time on 0508 722 205 (+64 9 526 0122).
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