When creating your dream backyard, financing is often a key consideration. The cost of a backyard remodel can quickly add up, and Houston homeowners should take a moment to consider the various options available.
From adding a pool to building a deck, backyard financing can help you get the backyard of your dreams without breaking the bank.
Options for Backyard Financing in Houston
In this article, we’ll explore the most popular financing options for backyard remodeling projects and discuss the most popular option used by customers of Pavertime.
Option 1: Personal Loans
A personal loan is a common way to finance a backyard remodel.
- Personal loans are unsecured.
- Can be used for various purposes, including home renovations.
- Typically have fixed interest rates.
- Can be repaid over a set period of time.
Personal loans are a good option for homeowners who need to borrow a large amount of money to finance their backyard remodel. They are also a good choice for those who want to avoid using their home as collateral for a loan.
Personal loans can be obtained from banks, credit unions, and online lenders. The interest rates and terms of personal loans can vary widely, so it’s important to shop around and compare offers before choosing a lender.
Option 2: Credit Cards
Credit cards are another option for financing a backyard remodel. They are easy to obtain and can be used to make purchases for materials and labor. Credit cards typically have high-interest rates, but if you can pay off the balance quickly, they can be a good short-term financing option.
Credit cards can be a good option for small backyard projects that you can quickly pay off before interest accrues. However, they are not a good choice for larger projects, as the interest rates can quickly add up over time and make the project more expensive in the long run.
Option 3: Government Loans
The federal government offers several loan programs that can be used to finance home renovations, including backyard remodels. The most popular government loan programs include:
- Federal Housing Administration (FHA) loans: These loans are insured by the FHA and can be used for a variety of purposes, including home renovations. FHA loans are easier to qualify for than traditional loans and require a lower down payment.
- Veterans Affairs (VA) loans: VA loans are available to veterans and their families and can be used to finance home renovations. VA loans offer competitive interest rates and do not require a down payment.
- Department of Agriculture (USDA) loans: USDA loans are available to homeowners in rural areas and can be used to finance home renovations. USDA loans offer competitive interest rates and do not require a down payment.
Government loans can be a good option for homeowners who have trouble qualifying for traditional loans or need to borrow more money. However, they have specific requirements and restrictions, so it’s important to research and understand the terms of each loan program before applying.
Option 4: Cash-out Refinance
A cash-out refinance allows homeowners to borrow money against the equity in their homes.
It’s a great way to take advantage of low-interest rates and consolidate high-interest debt, like credit card payments, with a small lump sum. With the cash flow from the new mortgage payment, you can use the extra funds to make improvements to your home and yard.
With a cash-out refinance, you would receive a lump sum of money to finance the project. This sum can be used as you see fit. On top of this, you can reduce your monthly payments by using the new consolidated amount instead of paying off multiple loans and debts.
Refinancing may not be for everyone – it’s important to weigh the pros and cons before making any decisions. But if you want to create, say, a new outdoor kitchen without taking on more debt, a cash-out refinance could be a good option for you.
Option 5: Home Equity Loans and Lines of Credit
Home equity loans and home equity lines of credit (HELOCs) are secured loans that allow homeowners to borrow money against the equity currently in their homes. Homeowners can use a home equity loan or line of credit to finance a backyard remodel.
Home equity loans are a lump sum that is repaid over a set period of time with a fixed interest rate. Home equity lines of credit work similarly to a credit card, where homeowners can borrow money as needed up to a certain limit. Home equity lines of credit usually have variable interest rates and can be repaid over a set period of time.
Home equity loans and lines of credit are good options for homeowners with significant equity in their homes and who need to borrow a large amount of money. However, these options often require using your home as collateral, which can be risky if you cannot repay your loan.
Pavertime Option: Take Advantage of Our Line of Credit Option
Our clients usually choose a line of credit via financing options with Wells Fargo.
Typically, we have a customer fill out a Wells Fargo form. The information is transferred into Wells Fargo’s hands, and within 10 minutes, you will have information about a potential line of credit based on your credit standing.
Our clients generally prefer the Wells Fargo line of credit for financing their backyard remodel, as the loan terms are 6 months or 12 months, the same as cash through an authorized Wells Fargo credit.
With this plan, there is no signing of collateral, no payment, and no interest for 6-12 months (depending on the financing plan). Credit availability is based on the applicant’s credit score, and the loan can be paid weekly, monthly, or all at once at the 6-month or 12-month mark.
If you’re interested in learning more about this option for backyard financing in Houston, contact us today to learn more. Let’s get started transforming your outdoor space!