Home Improvement Loans in Michigan

Yes, homeowners can get home improvement loans in Michigan. While some lenders may not service Michigan, there are plenty that do. As you start the search you can check with banks, credit unions, and online lenders. Before applying though, you will want to determine if a secured or unsecured loan is best.

Secured loans require collateral, typically in the form of equity in your home. For major renovations, you may need to use a secured loan due to the amount you’ll need to borrow. While secured loans can offer large loan amounts and low rates, they are hard to qualify for. Time consuming too. For smaller home improvement projects you may be better off using an unsecured home improvement loan. Unsecured home improvement loans or personal loans are available up to $100,000, depending on credit score and what the lender offers. Some lenders can fund home improvement loans in as little as 1-2 business days so in times of need, they can be a great option.

Government loan programs are also another viable option for residents in Michigan to obtain a home improvement loan. Each government loan program has its own requirements for qualification, however, there are plenty of funds available to people looking to upgrade or renovate their existing home or purchase an older home and fix it up.

These government loan programs can be found through agencies like the FHA, VA, USDA, Fannie Mae, Freddie Mac, and the Housing Improvement Program (HIP) administered by the Bureau of Indian Affairs.

Typically, a month from the loan disbursement date, your first monthly payment is due. Monthly payments are calculated by taking the total loan amount, calculating the APR and any other fees, and dividing it equally over the term of the loan repayment period. Loan repayment periods for home equity loans and HELOCs can be typically anywhere from 5 to 20 years and personal loans can have repayment periods anywhere from 12 months to 12 years, depending on the size of the loan.

There are many pros to obtaining a home improvement loan in Michigan. However, the biggest pro is getting the money you need for a home renovation or repair upfront. Home improvement projects can cost anywhere from as little as $5,000 to as much as $75,000 or more, depending on the project. If you are not looking to spend your entire family’s savings on a home improvement project, then having access to tens of thousands of dollars upfront that can be paid back through easy monthly installments is by far a major pro.

Here are some of the other pros of home improvement loans in Michigan.

• Fast approval and funding times: Many lenders can approve your loan application and fund your personal account within a few short business days.
• Competitive interest rates: If you have good credit, you can have access to some incredibly low-interest rates among other perks.
• A large number of lenders to choose from: The home improvement loan lending market is vast and there are many options available from loan type to lender. Competition can reward the borrower.

It’s these types of advantages that make home improvement loans a popular financing choice for many homeowners in Michigan looking to increase the value and curb appeal of their homes.

Although home improvement loans can be ultra-convenient, it’s important to not take the decision of borrowing money lightly. For that reason, let us take a look at some of the cons of taking out a home improvement loan in the state of Michigan.

• Higher interest rates for bad credit: If you have bad credit, it may be not only more difficult to qualify for a home improvement loan, but when you do, it can come with a much higher APR than your neighbor with good or excellent credit. Additionally, some home improvement loans, like personal home improvement loans, may come with an origination fee on top of the APR if you have poor credit. Origination fees can range from 1% to 10% depending on the lender.
• Risk of losing home: Some home improvement loans, like a home equity loan or an FHA 203k rehabilitation loan, use your home as collateral to secure the loan. Although there are some protections, the bottom line is if you are unable to pay your loan, there is a high likelihood that the bank or lender will sell your home to cover the debt owed.
  Additional monthly payment: Taking on a new home improvement loan comes with an additional monthly payment on top of your mortgage.

Before taking on any type of home improvement loan, it is important you understand the full implications and potential consequences of borrowing money, especially if you are using your home as collateral to secure the loan.

In order to qualify for a home improvement loan in Michigan, you typically need a minimum credit score between 620 and 680 or higher and a debt-to-income ratio that is below 43% including the new line of credit you are applying for. If you have a credit score below 620, you may want to consider an FHA 203k rehabilitation loan.

To qualify for an FHA 203k rehabilitation loan, you will need to have a credit score above 500 with a 10% down payment, and a credit score above 580 with a 3.5% down payment.

Home improvement projects are extremely popular in Michigan. Once you receive your funding, you could do any number of projects. Some popular projects include kitchen remodels, installing custom cabinets, putting in all-new hardwood floors, bathroom remodels, backyard renovations, constructing an addition or sunroom onto your existing home, and installing a concrete driveway that will last for decades. If you take out a personal home improvement loan, once approved, you can use the money to fund any type of home improvement or repair project you would like.

Unsecured home improvement loans are available up to $100,000. Keep in mind that $100,000 personal loans are typically reserved for borrowers with the best credit and the strongest incomes. It’s also important to keep in mind that not all lenders offer loan amounts up to $100,000. Most lenders have minimum and maximum loan amounts that borrowers can qualify for.
If you use a home-secured loan like a home equity loan or HELOC, then depending on the lender, typically you can borrow anywhere from 80% to 90% of the total appraised value of the home if you have a minimum of 20% equity built up.

The best way to find a beneficial home improvement loan in the state of Michigan is to use an online lender. Online lenders can help you obtain almost any type of home improvement loan that you would like and the process to prequalify, apply, and receive your money is extremely streamlined. While you may still want to compare your offer with a local source, it may not be necessary. To choose an online loan offer with confidence, start by comparing offers. At Acorn Finance you can expedite the loan shopping process. With a network of top rated lenders that serve the state of Michigan, you can check offers in 60 seconds or less with no credit impact. Our lending partners can offer home improvement loans up to $100,000 with terms up to 12 years, depending on credit score.