Summer is perfect for installing a new swimming pool to spend some quality time with family and friends.
However, you might feel a little disheartened after looking at the prices and may even start reconsidering the idea. But before you give up, what if we told you there are ways of pool financing that can help you get the ideal swimming pool?
We understand that one has to look at the logistics and consider everything at stake. As a result, we have narrowed down the following ways in which you can refurbish your backyard without having to make too many sacrifices. After all, a swimming pool has numerous practical applications to benefit you.
Moreover, it will help improve your home’s value, meaning if you decide to sell it, you can get a substantial price later on.
So, without further ado, read on to find the most effective pool financing methods.
Ways to Finance Your Pool
1. Home Equity Line of Credit
If you’re using a credit card, you will also feel comfortable opting for a home equity line of credit. It lets you borrow a decided sum of money based on your home’s equity, thereby allowing the creditor to choose the amount he’s willing to lend you.
You can determine the home equity value by specifying your home’s market value and then subtracting the owed amount. It has the added advantage of letting you make the payments at your own pace, provided you don’t default on the minimum monthly payment initially decided upon.
It’s very similar to your credit card payments, and once the money is approved, you receive a credit card or checkbook to use it for your pool financing needs.
2. Home Equity Loan
Although it sounds similar to our earlier recommendation, a home equity loan is a loan payment made to you by keeping your house as collateral. You get hold of the loan as a single amount, and the money is determined by the home equity value, which you could think of as a second mortgage.
A lender may offer you money in certain instances, around 90% of your home equity for pool financing. So, depending on the work you’re planning to do, it may or may not be enough. But we assure you that if you’re looking to make significant changes to your residence, you’re guaranteed to benefit from this method.
Further adding to the advantages are the low interest rates compared to personal loans or credit cards. You also get more time to pay back the money, anywhere between 5 and 30 years.
3. Personal Loan
A good credit score will give you the option of applying for a personal loan. It has several benefits, as you can withdraw the money as a secured or unsecured loan. Moreover, the amount is solely determined by your credit history, and you won’t have to offer your house as collateral.
So, if your credit score is high, you’re likely to get low interest rates, but even if it isn’t, there’s no reason to be concerned. You can reduce your loan’s longevity, or if you’re comfortable, you can offer your house as collateral, which will help lower interest rates.
As a result, there are no restrictions on how you can use the money, thereby making it a fast and efficient method.
4. Cash-Out Refinancing Loan
Another way to opt for pool financing is to choose a cash-out refinancing loan, a proven method to increase your home’s valuation, after installing the pool. It works by refinancing your mortgage to an amount that is higher than what you originally owe.
With the remaining money, you have the option of getting the pool installed. Moreover, you can refinance your mortgage at low interest rates, thereby making the process a money saver. Besides, you get to choose the duration of the loan from anywhere between 15 and 30 years.
5. Using your 401(k)
People who believe in long-term planning are most likely to have a 401(k) retirement fund. You can, therefore, opt for a loan against it as an effective method of pool financing. However, you can use the retirement fund only if you’re still an employee of the company that provided you with the 401(k) and your chosen plan.
If you’re in doubt, you can talk to your organization’s human resources department to get a clear idea. The method is hassle-free because there isn’t any credit check, nor is there any application procedure that needs to be followed. Meanwhile, interest rates are low, making it a much more suitable option than credit cards.
You can make the payments out of your paychecks, and unless you’re a defaulter, you won’t have to be concerned about paying a withdrawal fee.
6. Financing through Pool Companies
Occasionally, your pool contractor will provide you with all the information about pool financing. You can do so directly through the company you have chosen to hire, allowing you to access the money as secured or unsecured loans, among other options.
You also have the choice of using the company’s private funds, meaning you’ll get first-hand knowledge of the best interest rates. It saves you the trouble of having to do the work all yourself, but keep in mind that the rates are likely to be higher. It’s because you’re paying for a service to do the work for you, so there’s a convenience fee involved.
Apart from that, the application can be processed in less than 24 hours, thereby making the entire experience smooth and efficient.
We’ve reached the end of our guide, and hopefully, you’ve got a better idea regarding pool financing.
There are many choices to consider, so remember to conduct a quick survey and gather all the relevant information rather than jumping right in. Also, it’s essential to have an open mind because the method you were least likely to consider may turn out to be the best.
That’s all the time we have. Take care, Ciao!