Swimming Pool Financing
Swimming Pool Financing
I can't think of a more fun home improvement project to invest in than swimming pool financing. The investment should pay off with both added value to your property, and fun hours spent at the pool. But where should you get the money for this sort of project? There are a lot of options available to you actually to have you breaking ground in no time.
Swimming Pool Financing Plan
Your first option is to go straight to a lender, possibly where you've gotten your mortgage, and look into their loan options for the project. You'll find this is much like the loan process for a car, home, or other large purchases. You can find secured loans with your house as collateral and lower interest rates, or unsecured loans with much higher rates.
Another options is to refinance your home to free up money. In this case, you obtain a new mortgage with the amount you have left to pay on your home plus the swimming pool fees. The disadvantage here being that you have to pay all the upfront costs just like when you originally obtained your home loan, plus closing costs on your original mortgage. You are also lengthening the life of your home loan. The advantage is that you'll have a lower interest rate and the interest you pay is tax deductible. For more on that option check out How Does Refinancing Work?
The last option I'll cover is a second mortgage, or a home equity loan. These are two slightly different things, but I'm not going to cover the differences here. Instead, how this basically works is you obtain a loan based on the amount you have paid on your home already (also known as equity) and if you do not make payments on the loan you can lose your house. Because you take this risk, you get a lower interest rate, though usually slightly higher than what you are paying on your first mortgage.
Things to look for in a lender
- You want to find a company that has done swimming pool finances before. They will understand the process, the value this will add to your home, and be most helpful throughout this process.
- You want a lender that will work with the payment terms that fit you. If you need to pay over a certain period of time, find a company that agrees with the plan.
- Typically people want to find financing as quickly as possible, if this is the case you'll want an expedited loan process.
- Try to find a company that will work with recent housing sales in your neighborhood that had swimming pools or tax assessments. The alternative is an appraisal process that will add money to your loan fees and take up to a month to process.
- The lowest possible interest rate.
If you're looking to add value to your home and make your yard a more exciting place to be then this should be a great option for you. Make sure to take the time to shop around and obtain the best swimming pool financing you can find to make your pool the stress free place it should be.