A good credit score is a basic requirement for traditional home loans, but can you get home improvement loans with bad credit? Home improvement loans meant specifically for remodeling, renovating or repairing your home have similar financial requirements, but can offer a bit more flexibility. Here are the important things to know:
What credit score is needed for a traditional home improvement loan?
Lenders generally require a minimum credit score of 660-700 to qualify for a home improvement loan. While some approve lower scores, the trade-off is usually a much higher interest rate on the loan.
Can I get a renovation loan with bad credit?
The Federal Housing Administration (FHA) offers loans for borrowers with lower credit scores. If you need financing with lower credit, both the FHA 203(k) renovation loan and FHA Title I loan programs are worth investigating.
How can I borrow against my house with bad credit?
To borrow against your house, you need to take out a home equity loan or a home equity line of credit (HELOC). These options use your home as collateral, and allow you to borrow money against the total value. Home equity loans are better for large, one-time projects, while a HELOC is more helpful for funding smaller ongoing projects.
How to build up your credit to get a home improvement loan?
The best ways to build and increase your credit score are to:
- Enable automatic bill pay to guarantee on-time payments.
- Avoid "hard checks" on requests for new credit cards or loans.
- Improve your debt to income ratio.
Unfortunately, improving your credit score won't happen overnight. If you're in need of a time-sensitive renovation, consider these options for obtaining financing - regardless of your credit history.
About the Author
Janie Schriewer
Welcome to the Janie Schriewer & Associates at RE/MAX Results. Janie just wrapped up her 30th year in the business & over that time has been adapting to the always-evolving Real Estate industry. In recent years she has added 2 members: Her Son Derek—Licensed Buyer & Technology Specialist, and Buyers' associate Melissa Kelley. We are all full-service REALTORS who can assist with selling your home and/or finding you your next home. The added professionals mean potential Clients have more convenience for showings & direct communication with Franklin County areas real estate Leaders.
Communication is crucial in Real Estate & Janie leads by example for our team as she prides herself on availability to her clients. Whether you prefer texting, phone calls, emails, or instant messaging, Janie Schriewer & Associates can accommodate. Whenever you want to talk to us or work with a REALTOR, the Schriewer’s have the experience & care to offer the right advice for your situation. We know the intricacies of negotiating a deal from the original offer to the signatures at closing as well as alleviating all of the hurdles that may arise in between. We treat you just like family. We care about you and what is best for you. Call Us today. Thank you as always for friends, past clients and customers we love referrals. Talk to you soon.