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What Is “Home Improvement Mortgage” In Canada?

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A home improvement mortgage is a loan that enables you to borrow funds to improve your home. Find out more about Home improvement mortgage from this blog.

Home Improvement Mortgage

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This pandemic has limited our worldview to just the four walls of our homes. So naturally, we are compelled to spend most of our days indoors, quarantining. It makes now the best time to focus on increasing its market value through renovation and remodeling.

We understand that you have many desires about how you want your home to look, but just like everything else in life, it comes with a price, a hefty one too, but fear not, we have good news for you.

“Home Improvement Mortgage”

A home improvement mortgage is a mortgage that allows you to borrow money to renovate your property. Flooring, painting, and adding luxuries to your kitchen are just a few examples.
These are the kinds of loans that give you a variety of possibilities, such as a second mortgage, a personal loan, or a home equity line of credit (HELOC) to fund the renovation of your humble aboard.

Pros and Cons of HIM

We always recommend that you get the advice of a qualified financial advisor before finalizing a contract and taking out a home improvement mortgage. With perks come certain drawbacks.

We have provided some pointers below.

Home improvement
Source: Pexels

Pros

  • If you make payments on time, it will benefit your financial health.
  • It has the lowest rate of interest.
  • Premiums are usually constant and do not change.
  • You can avail of tax benefits most times. 
  • Boosting the worth of your home through the renovation will lead to good resale value in the future

Cons

  • It might be difficult for the average person to gauge and also take time to set up.
  • Very few banks provide this facility. 
  • If you don’t pay your dues on time, the credit will get hampered

Home improvement loans are to help people who cannot pay for upgrades out of pocket. It is a long-term investment because it increases the market worth of your home, making resale more profitable.

Even if you have no plans to sell it, it is always a good idea to decorate and make your humble abode a sight to behold in the heart because there is no place like home.

References:
https://www.canada.ca/en/financial-consumer-agency/services/buying-home.html
https://www.bdc.ca/en/articles-tools/entrepreneur-toolkit/publications/monthly-economic-letter/2104
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