Most people own more than one house in their lifetimes. The first house may be a “starter home” that the family outgrows. Job changes may force moves. Increased income may give homeowners the desire to move up to a larger house. But sometimes, for whatever reason, the need for something different comes up but the owners don’t want to move. Then what?

One popular option is to remodel the house or add a room or two. Kitchen and bathroom remodels are all the rage these days, as people are eager to get rid of their 70’s era Harvest Gold colored appliances. Some homeowners hire a contractor, and others are the do it yourself types. For the latter group, a home equity line of credit might be the ideal financing tool.

Why a line of credit, or HELOC, as they are sometimes known? The HELOC is perfect for the do it yourselfer who is completing a project over a long, indeterminate period of time. Unlike a home equity loan, which puts the money in your hands in one lump sum and requires repayment to begin almost immediately, a HELOC is more flexible. Once approved, a homeowner gets a checkbook or credit card from the lender that he or she can use when needed, as needed. Need a cooktop? Paint? A truckload of wallboard? You can run down to your local home improvement store and pick them up. You can pay back at a variable rate on a flexible schedule and you can borrow more when you need it.

The beauty of a HELOC is that once you repay the money, you are free to borrow it again! With a traditional loan, you borrow a lump sum, pay it back on a fixed schedule and when you are done you are done. Need more money? Then you need to apply for another loan, with another appraisal and more fees. With a HELOC, you simply use the checkbook or credit card again, and the money is there for you. It’s a great financing tool for most anything that involves recurring expenses, and a do it yourself remodeling job is an ideal example of that.

Of course, if your remodeling consists of hiring a contractor to add a room or do major construction, you might want to consider a traditional loan. That type of financing is particularly good if you know when the work will be done and if you know exactly how much it will cost. Under those conditions, it might be better to take out a loan that provides you with a fixed interest rate and a set repayment schedule.

No matter what type of remodeling you are doing, a line of credit can work in a pinch to provide the cash you need to get the job done. And if the work is ongoing and you need money again and again, a HELOC is the perfect tool. It’s the loan that keeps on giving.

If you have a mortgage with a high rate of interest, you may wish to think about taking out a new loan. You may be able to consolidate your debt and lower your mortgage payments. Ameriquest Mortgage can help you refinance now.

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