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How to Finance an Omaha Roof Repair

The possibility of having to repair a roof is something we all dread. If you need a complete roof replacement, the cost can range from $300 to $5,000 or more. The most difficult part is determining whether you have the financial resources to repair your roof; however, even if you don’t, there are some financing options for roof repairs.

Homeowners or Roofing Insurance

Do you need to repair a roof that should still be in good condition? This should be covered by either your homeowners or roofing insurance.

Roofing insurance comes in two types: either product or installation. Roofing product insurance will cover the replacement cost if the roof was damaged because the material was defective.

Installation insurance provides coverage in case the roofing work wasn’t done right. Licensed, bonded, and insured roofers should provide roofing work insurance. In this case, you can contact the company that did your roof and ask for repairs to be done.

Homeowners insurance should cover repairing a roof that was damaged by accidents or natural events. Roofs are often damaged due to falling trees, storms, fires, high winds, etc. If something like this happened to you, contact your homeowners insurance and let them guide you through the process.

Each insurance provider has different processes for gathering evidence, making estimates, and providing compensation.

Always check with your insurance providers first. After that, you can look for alternative sources of financing.

Home Equity Loan or Line of Credit

Financing a roofing repair is one of the few times when pulling equity from your home can make sense. In this case, you can look into getting a home equity loan or a home equity line of credit.

These loans use your home equity as the loan’s collateral and are both considered second or additional mortgages.

Home equity loans are provided as lump sums with a fixed interest rate. A home equity line of credit is a revolving line of credit that usually has a variable interest rate.

Contact a financial advisor if you are considering this. Home equity loans and HELOCs won’t be available to everyone. They are only options when you have good credit, a regular income, and your home is worth significantly more at current market value than you owe on it.

Loan providers will usually give out a maximum combined loan-to-value ratio of 80% to 90% of a home’s appraised value.

Get an FHA Title 1 Property Improvement Loan

If you don’t qualify for home equity financing, look into getting an FHA Title 1 property improvement loan. These loans are backed by the U.S. Department of Housing and Urban Development and provided by HUD-certified lenders.

FHA Title 1 loans are fixed-rate loans that come unsecured if under $7,500 or secured with home collateral if $7,500 or more.

HUD loans are available for home rehabilitation, repair, and general improvement as long as the repairs improve or protect the property’s liveability or utility. Roof repairs definitely qualify as improving and protecting the property.

But will you qualify? Here are the typical HUD loan requirements:

·   Be the homeowner or have a long-term lease on it

·   Be in a home that was built and occupied for over 90 days

·   Have a debt-to-income ratio of 45% or less

·   Not be in default or delinquency for another federally backed loan

If you meet these basic requirements, you usually won’t need a specified credit score, income requirements, or home equity.

Try an FHA 203(k) Loan

You also have the option of a HUD-backed FHA 203(k) loan. This is a government-backed mortgage that’s given out for construction purposes. You can use them to rehabilitate, repair, improve, or upgrade your house.

There are two FHA 203k loans available:

·   Limited 203(k) mortgage – to finance up to $35,000 into your mortgage for repairs or improvements but not major structural repairs

·   203(k) mortgage – work must cost at least $35,0000 with loan limits that vary depending on the area and currently range from $420,680 to $970,800

These loans come with a few more qualifications than FHA Title 1 loans. You will need a minimum credit score of at least 500 and a down payment, among other financial requirements.

Take out a Personal Loan

If government loans don’t interest you, look into using a personal loan or line of credit from traditional banking or alternative private sources.

Banks, credit unions, and private lenders are more than willing to step in and provide financing for home repairs – as long as you qualify.

You can search for roofing or home improvement loans online and quickly find a variety of offers. There are also private lenders offering roofing loans for individuals with poor credit. However, many of these loans come with high interest rates.

You may want to check what’s available online, then go to your bank or local credit union to see if they can offer a better deal.

Use Your Credit Cards

Financing a roof repair through personal credit cards should be a last resort. But it might be the best option if your repair won’t cost that much, you can pay off the balance quickly, and you can get a 0% interest rate.

Look into other sources of financing before considering this. Credit cards don’t provide the protection that other home financing can give and isn’t a tax-deductible loan.

Let’s Talk About Your Options

Need to get your roof repaired and not sure what the best financing option is? Get in touch with us and let’s talk about it.

We’ve been working on roofs in the local area for over 20 years. We understand the ins and outs of insurance and financing.

We’ll take you through the current home repair financing landscape, help you discover what your best options are, and show you how to get the best deal. As AGR roofing and solar has their own in-house financing when it comes to helping you get your repairs done.

We can also provide you with a roofing repair quote for your bank, credit union, or lender.

Send us a message and we’ll be right with you.

Contact AGR

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