Factoring in contractor fees, materials prices, and labor costs can sometimes make even the simplest home addition projects expensive endeavors. To cut down on overall costs, the team at SRK General Construction in Maryland Heights, MO, believes you should research available financing options before getting started. 

Below, their team shares a brief guide to financing options for home additions: 

• Home Equity Loans & Lines of Credit: If you don’t have the money needed to finance the project, consider opting for a home equity loan or line of credit. Similar to a second mortgage, the loan gives you 15 to 30 years to pay off home additions. Keep in mind that interest rates are slightly higher than what you’d pay for a second mortgage. When using a line of credit for financing, your home’s equity is used as loan collateral, with an eight- to 10-year window for repayment.  
• Mortgage Refinancing: If your home is valuable, consider refinancing the original mortgage for a larger sum. You can use the extra money to finance the project. If there’s a considerable amount of equity in your home, you might even be able to get lower interest rates without altering, or adding to, your current mortgage payments. When working on a labor-intensive project, like a new patio or second-story addition, your financial institution might sign off on a loan solely based on the anticipated boost in property value. 
• Federal Housing Administration Loans: If you don’t want to utilize home equity or mortgage refinancing, the Federal Housing Administration (FHA) offers loans that could cover home addition costs. An FHA Title I Home Improvement Loan is specifically designed for property alterations, repairs, and additions and doesn’t include any equity guidelines.  

To discuss your home additions project in the St. Louis area, call SRK General Construction at (314) 739-4443 today. A friendly, knowledgeable team member is standing by to provide advice. Visit them online to explore the ways they can make your property more spacious and like them on Facebook to see pictures of finished remodeling projects.