5 Tips for Financing a New Roof
August 24, 2020 (Investorideas.com Newswire) If you consider yourself a budget-savvy homeowner, you've probably thought of wallet-friendly ways to make some critical repairs to your house. Instead of paying out-of-pocket, you've probably considered reaching out to a lender to discuss a home loan. While home loans are a great way to handle bigger expenses, like your roof, there are a few things you should keep in mind before you apply for financing.
Between verifying your qualification status to reviewing your credit score and credit report, here are a few must-know tips for financing a roofing project.
1. Go through a preapproval process.
Part of why a home loan pre-approval is important is that it'll give you an idea of what the process will look like. Preapproval doesn't automatically mean an underwriter is going to grant you a loan. However, preapproval does make you a more likely candidate in a lender's eyes. Getting a prequalification or preapproval letter from your mortgage lender can give you more information on your financial situation, interest rates, and any applicable down payment. Thankfully, prequalification isn't a hard inquiry credit check. It won't show up on your credit score, and it's a great way to take an initial look at your credit history and eligibility for the approval process. Oftentimes, this is the first step for a serious buyer or loan applicant.
2. Talk with your insurance.
Sometimes, if you're looking to finance a housing or roofing project, your insurance will be willing to help, depending on the price range. It's unlikely that they'll finance an entire remodel, but they may be willing to help homebuyers make necessary replacements and repairs. If you've just moved into a new home and are experiencing roof issues for the first time, it's especially a good idea to reach out to insurance to see how much money they may be willing to contribute.
3. Find a contractor.
Before you fill out a loan application or provide financial information and employment verification, you should have a contractor in mind so you know the bids you're working with. This can impact the loan type you receive and make it easier to acquire a larger loan amount if necessary. Depending on where you live, finding a contractor is as simple as Googling, say, "Pittsburgh remodeling company." Typically, you'll find quality results for contractors that carry a license. Hiring seasoned professionals can help greatly with the renovation process.
4. Apply for a loan.
The approval process often requires a good amount of paperwork. From tax returns and bank statements to pay stubs and additional documents, you're going to need to provide a list of financial documents throughout the loan process. You'll also need to verify your employment history. This may seem like a more tedious process, but it's important for you as a borrower to go through it with your loan officer, especially if you're ready to work on your dream home. You'll also want to discuss monthly payments at this point.
5. Prepare your home.
A roofing job can take a while, especially if it's the first time the roof has been repaired. You need to make sure that both you and your house are ready for the contractors to get to work. If you'll have a hard time working in a construction zone, you may want to consider staying with friends and family for a bit. Otherwise, you'll just have to put up with a fair bit of hammering.
Financing a roof repair is an involved process. If you want to get the best deal, a good way to start is by following these tips. Just because you're done with the house hunt doesn't mean your work has ended. Round up your documents, meet with a loan officer, and see exactly what your new roof could look like.
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