Repairing or replacing a roof is always a big project that consumes time, energy, and money. It can affect your monthly payments when you don’t prepare for it.
According to HomeAdvisor, roof replacements cost an average of $7,796. The best way to cover a roofing project is with cash—but not everyone has the savings for this.
Thankfully, there are many ways you can go about this, even with bad credit. You can get payment plans from roofing companies in Maryland, get a loan, and more.
Here’s a guide to financing your roof repair or replacement.
You need to know how much your roofing project will cost before finding out how to pay for it. Get quotes from at least three roofing companies. Once you’ve collected the figures, see if there’s any significant difference between the rates and find out why.
This may be due to their service fee or the roofing materials used. Ask questions but educate yourself on the different roofing materials and how much they cost to see if their rates are fair.
For instance, an asphalt roof is a popular choice since it’s one of the most affordable materials. A 1,800 sq. ft home will cost around $4,286 to $6,429. Meanwhile, a solar panel roof will cost around $15,000 to $25,000.
How to Compare Financing Options
Most people’s first instinct is to go with the financing option with the lowest interest rate. However, when comparing financing plans, you need to consider other factors apart from the interest rate.
If your repair or reroofing project is urgent, you may not have the time to wait for some options. A loan, for instance, can take up to weeks to get approved. It would be unwise, especially if your roofer says that you risk more damage the longer you wait.
Roofing Financing Options
Many roofing companies take credit cards. However, this isn’t the best way to finance your project. You don’t have to worry if you’re confident that you can pay off the total amount in a month. If you cannot, you may be significantly paying for a higher cost due to the interest rate.
For example, your roofing project costs $7,000, and the interest rate is 15%. You pay the minimum amount of $200. This means you’ll end up paying an extra $3,000 once you’ve paid the debt off.
The exact figures depend on your credit card but paying more than the minimum will help.
Check if your roof damage is covered by the homeowner’s insurance policy or any limited warranties. If it does, insurance can cover part of the costs so that you need less from other financing sources.
If a storm or natural disaster damages your roof, you can process claims to ensure that part of the costs is covered.
The FHA Title 1 loan is a financial tool used for home repair and improvement.
First-time home buyers commonly use FHA. Meanwhile, Title 1 loans are used by homeowners to fund permanent renovations and improvements. Some even use the Title 1 loan along with a mortgage to fix a home they’re purchasing.
If you’re opting to go with an FHA Title 1 loan, it’s important to note the following:
- You get the loan from an FHA-approved lender.
- This loan has a fixed rate for home improvements, repairs, and rehab projects. Adjusting rates isn’t an option.
- If you’re planning to loan $7,500 and below, the loan is unsecured, and your signature will suffice. For larger amounts, your home will be used as collateral.
- The maximum amount of time you have to pay it back is 20 years, depending on the property.
How “home improvement” is defined by an FHA Title 1 loan is broad. According to the Department of Housing and Urban Development, the loan should be used to make your house more “livable and useful.” This can mean buying appliances, like a refrigerator or making your property more accessible to people with disabilities.
Get Advice from Roofing Experts
It’s good to educate yourself with roofing materials and financing options, but nothing will replace the advice of a professional. Contact G.H. Clark Contractors, Inc. for expert roofing advice. We’ll be more than happy to help you with your home improvement project.