Mortgage Underwater? No Equity Home Repair Loan Options
Aug 29, 2009 Mortgages
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The housing bubble has burst and because of the crash in home values across the nation there are a lot of people who are now living in houses that have not built up any added value over the past several years. This has put a strain on people who were hoping to use the increased financial value of their homes to perform some much needed home repairs.
In a normal active economy if you bought a home for $150,000 five years ago it might actually be worth $190,000 today. You would then be able to borrow money against that added value from a lending institution and use that money to upgrade your home. That’s the sign of a rising housing market: you could buy a house for a certain value one year and in the next year the value of the home would actually increase by a few percentage points.
Unfortunately many housing prices have actually dropped in the past year or so, which means a lot of people are now paying for homes that are now worth less than what they originally paid. When you owe more cash on a house than what it is worth then you are said to be “underwater” with your mortgage payments. This means they don’t have that extra home value which is known as “equity.”
If you’re looking for a big home remodeling loan then you may want to think about applying for a Title I home improvement loan from an eligible loan partner. There are lots of vendors of these kinds of loans, they offer a low interest rate and you may be eligible to pay it off over a generous 20 years. Just about any one who owns a home can apply for an FHA loan and eligibility is less restrictive than most traditional lending institution loans. You do not have to have equity in your home to apply for a Title I home improvement loan.
Another good way to keep the high price of a home improvement project down is to do at least some of the labor yourself. For most home improvement jobs the highest expense often comes from the amount of manual work involved, so by taking on some of that work yourself, you can really shrink the total cost of the overall project. There are lots of different do-it-yourself home improvement things most people can do around their houses with just a little bit of knowledge and a willingness to work.
As you can guess, big home improvements always end up costing more than the small ones. Most manageable house repairs can become large headaches if they are allowed to go unaddressed for too long. If you have a serious home repair that needs to be done, don’t let your home’s dropping value prevent you from obtaining the money you need to make the repairs.
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Tags: "mortgage, equity, home improvement, home improvement loan, loans, money, Mortgages, Title I loan
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