There are a lot of people who would like to remain in their homes for as long as possible. Unfortunately, a traditional home may have a few features that can make it difficult for people to stay in their homes as they get older. There are some modifications that can be done relatively easily to reduce the risk of falls. This includes adding handrails, improving the lighting, and even adding seats in the shower. Unfortunately, some modifications, such as making a home wheelchair accessible, can cost thousands of dollars. A home equity loan can make this process much more affordable.
How Does A Home Equity Loan Work?
If you have been in your house for a long time, you probably have a significant amount of equity built up in your home. There is a chance that your house may have been paid off entirely. A home equity loan allows you to borrow against the equity you already have in your home to receive a lump-sum payment. Then, you can use this money to make more expensive upgrades to your house, allowing you to age in place.
You can pay back the loan on your own schedule, and you only have to make the interest payment every month. The only rule is that you need to pay back your equity loan before you sell the house. If you sell the house and the home equity loan has not been repaid, part of the proceeds from the sale of the house will be used to pay off the home equity loan.
How To Get Approved For A Home Equity Loan
To get approved for a home equity loan, you will need to have all of the things that accompany a standard mortgage. You should have a low debt to income ratio, a history of steady income (or a nice portfolio with assets), a solid credit score, and enough equity in your home. In general, lenders will require you to have 15 percent or more built up in home equity.
You need to know how big of a home equity loan you need, so be sure to get multiple estimates for your modifications before you get started.