Your Guide to Renovation Loan Singapore

Home is where the heart is”. Surely, coming home to a place where you can rest with an ambience unlike no other is a given. No matter where you go, your home will ultimately be the place you want to be at because of the warmth, comfort, and safety of the walls that surround you. For that reason, it goes without saying that making sure your house is clean, organized, and well-kept is a top priority.

Home refinancing is part and parcel of owning a home. You might want to decorate your home according to your style to make it well, you! There are also times that you need to replace and repair the old essentials in your house like the flooring, or perhaps, buying a new necessity like a refrigerator. Unfortunately, it goes without saying that these changes are not necessarily cheap. If you want to take it up a notch and renovate your dream home, applying for a renovation loan might be the best option for you!

Money – Of course, you will need a sum of money to finance your way to your dream house. However, if you are short on budget, you can get a renovation loan to cover the expenses. Prior to taking out a loan, do take note about its pros and cons so that you won’t struggle with its repayments.

A lady put curtain to her room

So, what is in house renovation loan?

Renovation loans are a type of personal loan that are meant to help financing home renovations. As this type of loan is specifically meant to renovate houses, do expect a lower interest rate compared to the usual personal loans. You need to at least own a house or, an asset, for you to apply for this type of loan.

Hence, there are restrictions that come with a lower interest rate. For instance, you can’t use this loan to pay for expenses used for any other purpose other than renovation. There are also restrictions on the kind of enhancements for your house that you can use it for.

What can you use it for?

  • Roof replacement or repair
  • Flooring and tiling
  • Electrical and wiring installations
  • Replace damaged doors or windows
  • Install fiberglass insulation
  • Fine carpentry
  • Interior walls painting and wallpaper hanging

house renovation loan

How can you apply for an in house renovation loan?

If you are a Singaporean or a permanent resident of Singapore, here’s how you can apply for this loan.

Make sure you are eligible for all the essential requirement to apply for a loan such as:

    • 18 years and above a minimum of age

Prepare the essential documents needed for a renovation loan such as:

    • Identity card / NRIC
    • Income statement
    • Employment letter
    • Proof of residence bill (E.g. recent bill)
    • Proof of homeownership

You might wonder how you can fully utilize the loan you applied for to get your ideal house, hence; here’s a list of what you can do to help you check ‘dream house’ off your checklist!

Top 3 In House Renovation Tips

  1. Have a realistic budget

    Have a realistic budget

    It’s easy to get carried away when you are designing your dream house, but always be sure to not go over your budget. Don’t bite off more than you can chew! You might be tempted to buy what your heart desires while you’re at it, but all these desires might come with a great cost.

    What you can do is by deciding the total expenditure beforehand. Have a guideline to not go over the limit. It is imperative to keep in mind that it’s best to have lower expectations of your budget rather than overestimating your budget. This can help to keep your cost at a minimum later on.

  2. Keep built-in furniture to a minimum

    Keep built-in furniture to a minimum

    It may be tempting to buy elegant built-in furniture that is aligned with the notion that they can maximize storage space in your house. While it may help to minimize the gap between your house wall and your furniture, this pro also comes with its cons.

    It will be more difficult and expensive for you to get rid of or replace these built-in furniture once they are broken or become badly damaged because of its old age. Not only are they more expensive, these built-in furniture also usually requires a greater need to be taken care of.

    Hence, it’s best to purchase standalone furniture as it will be easier for you to replace them as you like, with a much lower cost.

  3. Do a research on who you are hiring

    Do a research on who you are hiring

    When you are doing home renovations, it is of paramount importance for you to find the perfect team to do the job. You definitely don’t want just anyone to fix your humble abode – a home which you will stay at for a long time, it’s best to hire a professional!

    Do a full-blown background check on your contractor by going through their credentials. Look into if they have a license, or a certificate of insurance that qualifies them to do the job. By doing so, you can be rest assured that they know what they are doing and would be responsible should any complications arise.

Conclusion

With all this in mind, there are things that you need to consider prior to getting an in house renovation loan. While it may be tempting to dive into your desires, you should be sure to be prepared if you are planning to opt for an in house renovation loan. To avoid paying a large amount of interest rate, make sure you allocate a sum of money every month for repayment.

Remember, you are responsible for your choices. Renovation loans can be of great help. But whatever it is, the most important thing is to always be prepared and manage your finances wisely.

If you’re looking for a way to finance your home renovations, you can go to 365 Credit for more information on the loans you want to apply for.