Your home is your most valuable investment, and it acts as a mirror of your personality. However, what was once brand new and suitable for your growing family’s needs may now be in dire need of renovations and unsuitable for your lifestyle. Has your family grown, and with it, have your ambitions changed? Do you need more space, want to redecorate the interior aesthetics of your rooms, and make an investment in your dwelling that will contribute to significant monetary returns? If so, you should apply for a home renovation loan.

Do you have big ambitions? Do you want your home to reflect your hidden interests? Are you looking to increase the real estate value of your property and obtain a significant return when you decide to sell and relocate to another building? In such a case, the only thing missing to deploy your vision is a substantial monetary influx. A home renovation loan can provide the cash boost required to invest in the aesthetics of your property, improve its comfort or functionality, and bring it in line with the demands of potential real estate buyers.

An Efficient Way to Save on Property Ownership Costs

The median price for Singaporean condos in 2024 is $1.7 million, while the average cost per square meter for market-listed properties is $20,244, one of the highest values in the world. Real estate in Singapore is valuable and is considered a constantly rising investment that can bring guaranteed returns. However, due to the continually changing prices, the prospects of SG families moving into new condos or houses without further financial planning are close to zero.

Do you live in a centrally located apartment and want your property to aid the growing demands of your loved ones? In such a case, the most viable financial solution at your disposal will be applying for a secured or unsecured home renovation loan. The costs of a comprehensive renovation of your apartment will be significant. Yet, once completed, its market value will likely increase by a higher percentage than the sums invested in the renovation works. If done right, the modifications made to your apartment could increase its market value by approximately 10%.

Considering the median price for SG condos, this would mean you could record a guaranteed profit of approximately $120,000 if you decide to sell. Also, it would help if you considered the benefits of improving your property's thermal efficiency. A renovation loan worth a few thousand dollars could be used for insulating your dwelling’s walls, installing double-glazed windows, upgrading existing HRVs, and installing modern air conditioning systems that, in the long term, could significantly reduce your monthly energy bills. So, considering that the price per kWh in SG is set to increase in the coming months, such an upgrade, long-term, could represent one of your most intelligent financial investments.

What Are the Maximum Sums You Can Obtain?

Your CBS score, annual income, and ongoing financial obligations to private or national creditors will determine the sums you can obtain through a home renovation credit package. Moreover, according to the stipulations presented in the Money Lenders Act of 2008, the maximum sum you can receive in Singapore for an unsecured loan will depend on your total annual wage. Do you earn over $20,000? Then, according to the law, the private or national lender you turn to can lend you up to six times your monthly wage. Do you earn between $10,000 and $20,000? In such a case, you can obtain a maximum of $3,000.

However, these limitations are only set for unsecured loans. Are you prepared to guarantee your loan with collateral? In that case, the maximum sum you can obtain will be determined by the internal conditions of the lender you approach. However, as a general rule, to obtain loans of over $20,000, you will need to present collateral with an evaluation close to the sum borrowed. Moreover, collateral-based loans are characterized by a lower interest rate, and because they are secured, they can often be approved even if your credit score is far from ideal.

Why Apply for a Credit Package Offered by a Private Lender?

Private lenders offer more flexibility when it comes to loan terms. Moreover, because they operate in a niche market marked by increased competitiveness, most of them provide digital platforms for applying for their commercialized credit packages. Private lenders have more flexible loan terms than traditional banking institutions and feature repayment tenures that can be modified according to the specific requirements of borrowers. Do you need an unsecured personal loan that you can repay in about a year? With a conventional bank, the interest rate you obtain probably wouldn’t make financial sense for your situation. However, with private lenders, things can be different.

Private licensed creditors compete in a niche market where the demands from target borrowers are high, and the flexibility from the regulatory bodies is limited. So, to differentiate themselves, the majority of private lenders try to undercut the competition and traditional banking institutions by offering credits with competitive interest rates and insignificant administration fees. Plus, private lending institutions are more lenient when it comes to the credit score requirements for their commercialized lending services, can usually offer higher loan amounts than national banks, and their activity is secure, as the Monetary Authority of Singapore regulates it.

An Efficient Way to Gather the Finances You Require

Home renovations are expensive, and without a loan, they could be a financial burden that your family cannot manage. However, in the long term, investing in a home renovation loan could represent one of the most inspired monetary decisions you can make. Newly renovated properties fetch a premium, and they can bring you market returns that will cover the initial costs of the credit package.

On top of that, you must consider the potential for long-term savings. Renovated dwellings can be tailored to specific tastes and implement the latest thermal savings technologies. Are your monthly expenses increasing rapidly? Have rising outside temperatures increased the costs associated with your HVAC systems? Are you looking for a way to reduce your electricity bills, decrease the thermal losses of your property, and make your rooms more aesthetically attractive and functionally relevant? Then, you should invest in a comprehensive renovation plan that covers your entire property. However, it will not be cheap.

Uncomplicated renovation work that includes wall paintings, small-scale repairs, and the installation of new fixtures will cost around $15,000. However, a more comprehensive renovation plan could necessitate an investment surpassing $30,000. A home renovation loan will be necessary to obtain the funds required for your vision. However, ultimately, it will be worth it, as house renovations are the primary way to increase a house's market value and obtain a positive ROI.

Oznake: Home renovation loan