6 keys to borrowing and mortgages in a reform

It is possible that we need a loan or a mortgage for a reform and we need to be well informed about what is necessary, its advantages and disadvantages.

In order to achieve our dreamed house, in many cases we will need an integral reform. Depending on the size of the project we will need certain amount of capital.

One way to obtain the necessary capital you need is to take out a loan or a mortgage. However many doubts can arise:

Is it better to take out a loan or a mortgage? What are the advantages?

It is advisable to know some previous factors before taking an important investment decision such as this so we invite you to learn more about these reform financing.


1. Have the budget at hand

The first step before asking for funding for our integral reform is to properly prepare a budget of the project we want to do.

Calculating the cost for an integral reform before starting is a wise decision to work safely and with a plan of the expenses to be made.

Together with the budget you also have to consider the materials used, the permits to be processed and the preparation of a contingency fund.


2. Benefits of a loan

There are many types of loans for household integral reforms. They are designed to provide appropriate capital and a different interest rate depending on the project.

There are even options for loan applications to create energy-efficient homes to finance the purchase of solar panels, energy efficient appliances and other sustainable equipment.

6 keys to borrowing and mortgages in a reform


3. When to apply for a loan

The case in which it is advisable to apply for a loan at the beginning of the reform or when acquiring the property to which the reform will be made, this is because the opening costs are lower.

As additional advice if you decide to apply for a loan from the same bank in charge of managing your mortgage, you can save the costs of related insurance.


4. The benefits of a mortgage

The extension of a mortgage can be the solution to acquire a larger amount of capital in a more returnable way.

Additionally, when applying for a loan, the appraisal of the property involved is considered for the process, however, it is difficult to estimate the appraisal of the final result of the reform. These inconveniences are avoided with the mortgage.

As another benefit of the mortgages, there is a maximum term generally can be 30 years (With certain considerations on the age of the borrower)


5. Aspects to consider of the mortgage

It is complicated that the bank entities accept this kind of petition with the disadvantage that involves other expenses like:

  • Renewal fee
  • New valuation after the reform
  • Administrative and notary fees
  • Registration of property
  • Documented Legal Acts Taxes

Although this is not always the case, given the case that it depends on the bank entity, these are potential expenses that can be included in the process of mortgage extension.

6 keys to borrowing and mortgages in a reform


6. Don’t rush

This last advice is for once again, emphasize that you should not rush into investment decisions like these. It is better to look for all the options and if it is possible to have the support of a professional.

There is no need in taking risks if you want to apply for an integral home improvement loan or if you decide to opt for a home improvement mortgage. The important thing is that the financing adapts to your needs.

Did you know all these aspects of the integral reform loans and mortgages?

Do not hesitate to share any question, concerns or opinion with us.

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