How to finance a general renovation of a house

Spring is the time when many of us decide to slightly renew our apartment. When the savings are not enough, you must use a credit product. Analysts of the financial comparison engineer suggest ideas on how to finance a general renovation of a home.

The coming of spring promotes courageous decisions. For many, it will be a decision to thoroughly renovate and renew your apartment. If, in addition to traditional repainting, you also need, for example, a complete restoration of the bathroom or kitchen, a device from a new room, purchase of furniture and household appliances, replacement of windows, etc., costs can go in tens of thousands of zlotys. The experts of the financial comparison engine are therefore checking where to get an example of 50,000. PLN for home renovation.

Mortgage loan

Mortgage loan

The best solution is the mortgage loan. It is a liability secured by a mortgage on real estate, therefore its interest rate is relatively low, comparable to mortgage loans. The real interest rate, that is counting all credit costs, can be even below 10%. Installments of the best mortgage loans for 6 years at 50 thousand PLN can amount to less than PLN 900 per month.

Unfortunately, the basic condition is that there should be no mortgage entry in the land and mortgage register for another lender. Another inconvenience when applying for a mortgage is the amount of formalities and related costs. In addition to the commission, real estate appraisal, mortgage establishment by the bank, mortgage entry or bridging insurance (pending the delivery of a legally valid copy of the land and mortgage register with the mortgage entered into the bank). Just the formalities and time-consuming credit analysis cause that a mortgage loan will not be received overnight.

The best mortgage loans for home renovation (PLN 50,000, for 6 years) are currently offered by Banks. Monthly installments of liabilities in these banks will not exceed PLN 900. A much more frequent situation than, for example, in the case of a cash loan or even a mortgage loan, is to collect a commission for granting a mortgage loan. They reach even 4.5 percent of the amount borrowed, i.e. in the analyzed case over 2 thousand. zł.

A cash loan

A cash loan

A definitely more convenient way to get the cash you need will be to take a cash loan. Formalities should take several days, so you will not have to wait long for funds.

A cash loan will certainly be an option more expensive than a mortgage loan. In total, all costs (interest and obtaining a loan) will be higher by at least PLN 4-5 thousand. zł. The average installment of currently offered cash loans is PLN 1,150, while mortgage loans – PLN 906. The average real interest rate on cash loans is almost 2 times higher than mortgage loans – almost 20 percent. towards 11%

Currently, the best offers of cash loans are the proposals of Crediter and Manubank. Both require the creation of a personal account – the first L package, the second online account. A premium for insurance in the amount of 2.99% is added to the loan installment of Crediter. (life or life and health insurance and unforeseen fortuitous events).

Worth recommending are also a standard loan from Crediter (it is distinguished by a commission for granting a loan and a higher interest rate), a loan for each Manubank, a cash loan by Meteor Bank and a loan in Credit Agricole in Proster. In these banks, the monthly installment will be below 1 thousand. zł.

Meteor Bank’s offer also deserves additional attention. This institution promises to propose a lower installment than the competition, if it is presented with an information form from another bank. The offer applies only to unsecured cash loans with life insurance.