The roof protects your house and its contents, so you shouldn’t ignore emergency roof damages. Unfortunately, such damages might arise when you don’t have any money for repairs or replacement. Fortunately, a little research will review a few options for financing for your roofing project. Below is an overview of such options.
Home Warranty
If your home or roof is relatively new, check if your roof warranty covers the repairs. Roof warranty typically comes in two forms:
- The manufacturer’s warranty that pays for defective roofing materials
- The contractor’s warranty that covers negligent roof work
Note that roofing warranties come with terms and conditions. You may have to prove that you haven’t violated any of the terms before you can claim the warranty.
Home Insurance
For many people, home insurance is the best option for paying roof repair costs. The dwelling coverage portion of your home insurance covers structural damage that arises from covered perils. You must prove the cause and cost of the damage before the insurance company can settle your claim.
The coverage limit determines how much you can claim. For example, with an actual value policy, the maximum you can claim is your roof’s pre-damage value. Thus, if your roof is old, which means it has depreciated considerably, the insurance payout might not cover the replacement. Most roofing contractors will help you process your insurance claim.
Roofer Financing
If you don’t have a valid warranty or insurance coverage, then you can try roofer financing. Many roofing companies offer financing for homeowners who need it. Others can get you the money from third-party financiers. If you take this route, the roofing company will base the financing on the repair estimates.
Home Equity Loan
Another option is a home equity loan, which you can get if you have built substantial equity in the house. Your home’s equity is the market value of your home minus all liens attached to the property.
Say your home is worth $300,000, and the only lien is an outstanding mortgage of $100,000. Your home equity loan is $200,000, and you can borrow a percentage of it for your roofing. Home equity loans are best for expensive investments, such as roof replacement.
Government Financing
The government also has financing options homeowners can use for their roofing projects. Below are a couple of popular options.
1. FHA Title 1 Loans
The Federal Housing Administration (FHA) Title 1 Loan guarantees loans provided by other third parties, such as banks and credit unions. FHA Title 1 loans come in handy for those who don’t qualify for home equity loans. For example, your home equity might be inadequate if you bought your home without a down payment, and you haven’t repaid the mortgage.
2. FHA 203K Loans
The FHA 203k Loan is an alternative to the FHA Title 1 loan. You may qualify for FHA 203K Loan even if you don’t qualify for FHA Title 1 Loan. You repay the loan alongside your mortgage repayments.
Personal Lines of Credit
Lastly, you can also use your personal lines of credit to pay for your roof repairs. Many financial institutions even have tailored-made loans for home improvement. Talk to your usual bank or other financiers to find out how much you can borrow.
Hopefully, you will find the money to take care of your roofing project before the damage worsens. Ensure you deal with a reputable and experienced roofing contractor to minimize the costs. Done Right Home Improvements, has the resources and experience to handle all roofing projects. Contact us for a quote to know how much you need to complete your project.