Fortunately for 21st century homeowners in central Florida, options for financing a roof abound. Five possible options, all outlined below, give you plenty of flexibility in solving your full roof replacement dilemma.
Always an Answer
Roofers are not financial experts, but we encounter enough worried homeowners to know paths to problem solving. You may feel you have no way to pay for necessary roof work, but you do! The money gurus at Motley Fool outline several ways to finance roof repair and full roof replacement.
Remember, a leaking roof will not wait for you to win the lottery, inherit a fortune, or scrape together savings. While some homeowners despair of ever finding a way, there is always an answer to financing a roof replacement.
Ideally, every central Florida homeowner has a six-month cash reserve for emergencies (job loss, major home issue, medical problem). Full roof replacement definitely qualifies as a major home issue.
Paying for a roof with cash will save you interest payments and the impact can be spread over time.
When you sign a contract for full roof replacement, most roofers will ask for a down-payment (we ask for 10% of the contracted price). This money is used to gather materials and solidify your spot in our schedule; we bill the remaining balance once your project is complete.
2: Credit Card
Unsecured credit is generally the most expensive borrowing, but for some homeowners, using a credit card can work. If you can combine cash down and a credit card, you can lessen the dent in your credit score.
Of course, the amount you can place on a card (or cards) will depend upon several factors:
- The total contracted cost of the roof replacement
- The number of credit cards you have
- Existing debts on those cards and each card’s debt limit
Also, consider the additional processing fees of 2.5-3% of the amount being charged. This extra cost could add a hefty chunk to your project.
For homeowners with good credit, those Motley Fool experts recommend finding a credit card with 0 percent interest, even if that is an introductory promotional rate. Use it exclusively for the roof replacement, and diligently pay it every month within the promotional period. At the end of the introductory time, your roof can be paid off.
3: Home Equity Line of Credit (HELOC)
As a homeowner, you may have a line of credit based on the equity in your central Florida home. Talk with your lender about securing a HELOC, which is essentially a revolving charge account that taps the equity in your home only to the extent you need. As you repay the loan for the full roof replacement, you regain home equity.
4: Home Equity Loan
A home equity loan is not the same as a HELOC; with a home equity loan using your home as collateral but without the “revolving credit” aspect of a HELOC. You must know the total amount you need ahead of the loan, and then make monthly payments over the loan’s term. You will pay interest, but a home equity loan has lower terms than unsecured credit (credit cards or personal loans).
5: Roofing Contractor Loan
Perhaps the easiest, fastest, best way to arrange complete financing for a full roof replacement is to keep everything in-house. Your professional roofer can connect you with excellent financing geared to your roofing project.
Most roofers have strong connections to local lenders. Some high-quality roofers even can tap the power of statewide programs. Don’t be shy about asking your roofer for help in arranging financing for your home’s roofing project.
Your roofer can provide the finance company with full details on the exact nature of the roofing work, its complete costs, and projected schedule. That helps you get the best possible terms for your loan. And, your loan is expedited through your roofer.
For example, at Alan’s Roofing, we can help you work with two excellent lenders:
- EnerBank has been providing home improvement loans for 20+ years; they only work with U.S.-based contractors in the residential home remodeling business for at least three years and offer online or paper document loan processing, low monthly payment loans, and fast approval
- The statewide Property Assessed Clean Energy (PACE) program provides financing that is a ‘Debt of Property’ rather than personal debt, repaid through your property taxes
We proudly serve homeowners throughout central Florida with every aspect of roofing, including inspection, repair, and roof replacement. To explore your options with full roof replacement, contact us at Alan’s Roofing today!