Category: Property Financing

Having a house is not only about a place where you stay or a property on which you have invested, intending to turn it into a source of income, but there is much more to it. It is an asset that you possess, which you can use in your favour if you are ever in a crisis.

Having a house makes your financial portfolio stronger, and you can easily get a loan.

How Having A House Benefits Secured Personal Loans?

Your house can act as your collateral, and thus not only will your loan get approved quickly, but you will also get it at a lower rate of interest.

A secured loan can get you cleared of consumer debts like your credit card bills. And repayment of your loan on time will help you to improve your credit score.

Overall, we can say that if you are a house owner and you need some liquid funds, use the house in your favour.

A loan is also a kind of debt. When you take up a loan to solve one problem, you also must remember that the loan debt is also becoming a burden on your shoulder. So, it is only better to make all the payments for the loan as soon as possible.

How to clear your loan faster?

Increase the amount of monthly payment

Once you clear your other debts and are somewhat in a stable position, you can increase the monthly payment for the mortgage loan you have taken. For example, if it was $50 previously, make it $100. This will reduce your mortgage years by several years. And in turn, you will save a lot, as the interest money will come down by a considerable margin.

Instead of monthly, you can also make weekly or bi-weekly payments, if you can make it.

Make lump-sum payments

Check your mortgage contract. If you are allowed, then you can also make lump-sum payments along with the regular payments. This will also help you pay off the loan early, and you can save money by paying less interest.

However, do not pay anything exceeding the prepayment privilege value. Then you will have to face the prepayment penalty, and it will become an extra expense.

Being a homeowner, you can also consider refinancing your home. You can gain many benefits from it. Like:

1. There will be lower rates of interest, so the monthly installment amount will also decrease.

2. It leads to consolidating debt. Thus, there will be free liquid cash in your hand to take care of other debts that have high interest, like credit card bills.

3. If you get extra funds from any source like work promotion or tax refund, use it to make mortgage payments. Refinancing an open mortgage can help you to get better prepayment privileges. However, if the interest rate drops, you should stick to the fixed-rate system to take advantage of the low-interest rates.

Conclusion

In conclusion, it can be said that using your house for getting loans and paying off debts is an intelligent decision. You have to be smart while making these financial decisions, and then you can solve any of your debt situations smoothly, without taking too much pressure.

Is lack of finances holding you back from carrying out your home renovation? If yes, then this doesn’t have to happen to you. Fortunately, there are several financing options available to meet your home renovation needs. Given below are some of the most common ways you can avail funding for your home renovation project. 

1. Savings or a Credit Card

If your home renovation project is small, then consider paying for it yourself. Use your savings or credit card to fund your labour and material expenses. But make sure you do not exhaust all your savings. Keep aside some money for unexpected expenses. However, if you are using your credit card for financing, be aware of its high-interest rate and try paying off the pending amount as soon as possible.  

2. Personal Loan

A personal loan benefits you with a lower interest rate as compared to a credit card. Also, it has short-repayment options. After completing your personal loan, you are eligible to apply for it again if there is a need for more funds.

3. Personal Line of Credit

If your home renovation process is ongoing and will continue for a long, make Line of Credit your go-to option for financing. With Line of Credit, you can use funds as and when needed, and you will pay interest only on the amount you use. Thus, this financing option saves you from paying unnecessary interest on the whole loan amount. This option also provides you with the flexibility of using funds throughout the renovation process.  

4. Secured Line of Credit and Home Equity Loan

These loans provide you similar benefits like personal Line of Credits and other loan types. But the major difference is that these loans require you to pledge equity of your home as collateral. Also, these loans attract some legal charges.

5. Mortgage Refinancing

If your renovation project is expensive and requires a considerable investment, then go for mortgage refinancing. This particular financing option provides you access to better interest rates and long term flexible repayment options. However, these loans are subject to loan set-up costs.

6. Financing Upon Home Purchase

If you want funds for the house’s renovation, you are about to purchase, consider financing your home purchase. This will cost you a lower interest than on credit card or other loan types.

7. Grant and Rebate on Energy Efficiency Renovation

If you plan to renovate your home to boost its energy efficiency, you are eligible for receiving grants or rebates from Federal, provincial, or municipal governments. To support this, many local utilities have also come forward. They also reward homeowners with a refund on energy-efficient home renovation financing. 

8. Grants for Seniors

Seniors citizens are also eligible to avail of grants on their home renovation projects. These programs are aimed to help seniors improve the accessibility, safety, and energy efficiency of their homes. 

Don’t let your ageing home lose its appeal. Opt for any of the financing options to fund your home renovation needs. If you want to efficiently assess your finance options for home renovation and need guidance, contact the right property financing company.

MTL GROUP is a property management and financing company, operating in the Greater Montreal area in Quebec. Our professionals are just a phone call away to assist you with your property management and financing needs.