The Experts Guide to Finding Cheap Home Improvement Loans

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By Michelle Tuvey.

Loan Underwriter

You know your home is one of the most important investments you will ever make. You also know that without constantly maintaining and improving your home, it is an investment that will never grow in value. However, what do you do if you do not have the money to make the improvements you are hoping to make? We suggest applying for one of the many home improvement loans currently available in the UK.

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Secured Loan Expert believe secured home loans are one of the best financial tools available to homeowners. These loans allow the individual to leverage the value already in his or her home to borrow large amounts of money with friendly repayment terms. Moreover, as a secured loan, this financing is cheap and fairly easy to get, provided you have equity in your home. Here is a brief, step-by-step guide to obtaining a cheap home improvement loan:

Step #1 – Calculate Your Equity

The first step in obtaining a cheap secured loan is understanding how much you are eligible to borrow. You can figure that out by calculating the equity in your home. Equity is the difference between how much your house is worth on the retail market and how much you currently owe on your mortgage. Just subtract your mortgage balance from the retail value of your home; the resulting number will be your equity. For example, a home worth £100,000 with an outstanding mortgage balance of £70,000 has equity of £30,000.

Step #2 – Create or Adjust the Family Budget

If you do not yet have a family budget, you need to create one in order to determine how much you can afford for monthly loan payments. Those who already have a budget need to adjust it to make sure unnecessary spending is curtailed. Without a proper and reasonable budget in place, it is too easy to become overextended with a secured home loan. That's not a good idea when you consider the fact that defaulting on a home loan could result in the repossession and sale of your property.

Step #3 – Compare Multiple Lenders and Loan Products

There are dozens of banks, building societies and specialist lenders offering secured home improvement loans to consumers. Compile a list of lenders you are interested in working with by comparing them side-by-side, along with the secured loans they offer. Your comparisons should include things such as loan-to-value (LTV) ratio, representative APR, maximum loan amounts, and repayment terms. Your completed list should include those institutions you are willing to investigate further.

Step #4 – Investigate Additional Costs

Every consumer loan comes with additional costs and fees above and beyond the advertised interest rate. These costs are represented in what is known as the representative APR. Nonetheless, do not rely solely on this advertised number – you may not qualify to receive this rate. Instead, contact individual lenders and ask for a detailed list of all the associated costs and fees for borrowing. Getting a cheap home loan hinges on knowing what these costs are.

Step #5 – Apply with the Best Lender

Once you have determined which lender is offering the best deal, it is time to apply. Be sure to be completely honest and open in your loan application in order to avoid a rejection based on inaccuracies or errors. An approval should lead to you having the cash you need in a short amount of time. Also, do not choose to have your cash delivered within hours unless you absolutely need it desperately. Banks usually charge extra fees for early delivery.

If you are rejected by the first lender you applied with, do not immediately apply with a second bank. Instead, get a copy of your credit report to see if there is anything amiss. Every time you apply for a loan, the lender runs a credit search, which then becomes part of your record. Multiple credit searches can negatively affect your credit score.

Cheap home improvement loans are great tools for leverage the equity in your home to make those improvements that will increase its value. However you should always seek independent advice to ensure that a secured loan is the most appropriate product for your particular circumstances.

Our Expert Help and Advice For Free

If you are short on time or don’t want the hassle of trying to find and compare the best deals why not let our experts do the work for you. Our team have access to a whole of market panel of the top UK secured loan lenders from which they can source the best deals in just a few minutes. Our team will help you compare the offers side by side, ensure that you are aware of all the charges involved with each loan before you make any decision to apply and use their knowledge of the lenders to create and submit  an optimised application on your behalf which ensures the lender reviews your case in the best possible light.

Just call our friendly team today.

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