Renovation Loan

renovation-loan

We all know that renovating a house requires you to spend huge sums of money. To be precise, a house renovation project may be as costly as building a small house. This fact scares most of the people and eventually, they opt not to renovate their house. However, if you have proper finance knowledge, then you certainly know about renovation loan. Typically, a house renovation loan will help you to finance your renovation easily. So, let us take a look carefully to know about the details of renovation loan.

What is a Renovation Loan?

A renovation loan’s main purpose is to offer a face-lift to your property. Using a renovation loan, you can hire interior decorates, or you can just paint your walls and floors with your choice of color. In addition, you can repair or install the plumbing equipment as well.

A typical renovation loan includes a standard amount of $10,000 to $30,000. The interest rate per annum would be in between 3% to 6%.

The Best Features of Renovation Loan

  • Most banks and licensed moneylenders in Singapore provide renovation loan with a tenure of one to five years.
  • The maximum amount that is allowed for a renovation loan is 6 times the salary of the applicant or S$30,000 (whichever is lesser).
  • If you add a co-applicant, the loan amount will increase, accounting for the full S$30,000 per additional co-applicant.
  • Mostly, the banks will offer loans either on a flat interest rate or a monthly rest option that changes every month but tend to be lower.

Eligibility for Renovation Loan in Singapore

To get a renovation loan in Singapore, you have to fulfill the following requirements –

  • You must be a Singaporean or a Permanent Resident.
  • You have to be 21 – 65 years old to apply for the loan.
  • The annual income requirement for taking this loan differs from bank to bank. However, this amount will generally begin from S$24,000 per annum.
  • If you wish to take the loan in partnership, the co-applicant must be an immediate family member of the primary applicant.

What can this Loan do for You?

You can use the renovation loan for the following purposes –

  • Electrical and wiring works
  • Built-in cabinets and structural alterations
  • Painting and redecorating works
  • External works within compound of the house
  • Flooring, tiling, and essential bathroom fittings

Keep in mind that you cannot use this loan to pay for the furnishings projects (Furniture / Appliances).

To conclude, a renovation loan is principally a great option for renovating a house. With the soaring living cost in Singapore, this loan will help you to have your designer dream home easily!

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