One of the best investments you can make in the real estate market is in Home Improvements. While buying a new home comes with its incentives, if the prices in the market are systematically rising, it also has a disproportionate underlying risk, especially if you take out a mortgage to buy a house.
Renovating your house can help you in several ways:
- Get deductions on your taxable income.
- Make your home more comfortable for your family.
- Increase the market value of your property.
What are the Alternatives to Finance Your Home Improvements?
While these are the more apparent reasons to consider your house’s improvement, the critical question is – where can you get the capital to make the improvements? The most common ways to get funding for your home improvements include:
- Getting an unsecured loan from your bank. Such products tend to carry a very high rate of interest.
- Ploughing your excess cash-flow into your home-improvements. This would make sense only if the return in the form of expected appreciation in your house’s value is greater than the returns available on other investment products with similar risk-profiles.
- Getting one of the best remortgage deals to get additional capital.
How Does a Remortgage Deal Get You the Financing for House Improvements?
The idea of getting a remortgage deal for financing the improvements in your house is a great way to participate in the increased value of your home, even if you already have an ongoing mortgage. Here is how it works out:
- Assume that your existing mortgage stands at a total of GBP 150,000, which was about 80% of your house’s value when you took the mortgage a few years ago. Now, the value of your home has increased, and hence, the same 80% of the increased price comes to about GBP 170,000.
- If you do not take a remortgage, there is no way you can take advantage of this price-rise without paying out your entire mortgage.
- If you can get one of the best remortgage rates, you can get the GBP 170,000 and pay-off the older mortgage. The excess cash, which comes to about GBP 20,000, can be used for making improvements in your home.
The price of an average home in the UK has increased from a base of GBP 185,000 in January 2008 to about GBP 239,000 in July 2020 – an increase of about 30% across 12 years.
How to Get the Best Remortgage Deal to Finance Your House Improvements?
You should check for two things before you get the process started:
- What is the pending amount on your ongoing mortgage deal?
- Have the prices of houses in your neighborhood recently increased?
Once you have a definitive answer to both of those questions, approach a mortgage broker. If you want the best remortgage rates, get in touch with the team at Zinga Mortgages. Here is how the process will unfold:
- After evaluating your needs, your mortgage broker will source some of the best remortgage deals for you. The broker will also help you establish the criteria to help you analytically compare remortgage deals.
- Parallel to this, a good broker will connect you with its associates to get the documentation processed, just in case you need a lawyer or an accountant’s services.
- If you are working with an established broker, the mortgage broker will help you quickly compare remortgage rates as well as other details in the deal and lock a remortgaging agreement. The broker will also expedite the process with the bank or the lender to close the deal quickly.
Once you have access to the capital, you can use it to pay-off the older mortgage and use the remaining capital to increase the value of your home with improvements.
With the help of a good mortgage broker like Zinga Mortgages, you can source the best remortgage deals with no fees and then get expert advice on selecting just the right remortgage product. To get access to capital for renovating your house with a good remortgage deal, get in touch with the team at Zinga, today!