LINES OF CREDIT
HELOC: Your Ticket to Maximizing Your Home’s Value
There are a lot of big decisions to make when it comes to selling your current home and buying a new one, and one of the biggest is whether or not to renovate or update your current home to help it achieve its maximum value when you sell. Whether you feel that it just needs a coat of paint and minor repairs or a full-blown kitchen renovation, a Home Equity Line of Credit (HELOC), known as a MeritLine at Tandia, may be a helpful tool to allow you to purchase what you need to maximize the value of your current home. Putting a few thousand dollars into renovations can go a long way to helping increase the sales price of your home.
What is a Home Equity Line of Credit (HELOC)?
A HELOC is a type of secured loan that allows you to borrow money against your home’s equity. A HELOC typically has a variable mortgage rate, is open to prepayment at any time without penalty, and allows a member to borrow up to their credit limit, repay the amount borrowed and then use it again in the future, if needed. This makes a HELOC, such as Tandia’s MeritLine, a flexible option which may be more appealing than a traditional fixed loan. You can learn more about MeritLines by clicking here.
What could this type of loan arrangement look like?
Tom and Ellen are looking to move into a new, larger home in a few months, and they currently live in a home that is 25 years old. Through discussions with their real estate agent, they’ve determined that the value of their current home is $750,000, but the agent tells them that if they replaced some damaged laminate flooring, she believes it could sell for closer to $800,000. Tom and Ellen get a quote, and the cost to update the laminate flooring would be around $15,000, making this a worthwhile investment to maximize the sale price of their home. Tom and Ellen contact Tandia and arrange a MeritLine to cover the cost of the upgrade, and they make a plan to repay the loan at the time of sale.
Should I consider a Tandia MeritLine for renovations on my current home before selling?
Knowing the value of your current home, and the amount your home would likely be valued at upon completing some updates, is an important first step. Not all renovations may be necessary, but a real estate agent or other professional may be able to guide you towards improvements that could help you get the most bang for your buck.
Common renovations and updates prior to selling a home, particularly an older one, may include:
- Modernizing the front door and front entrance area- Home repairs (e.g. patching drywall, repairing appliances, replacing cracked tiles)
- Updating floors
- Bathroom or kitchen remodel
- Updating lighting
- Repainting, typically in a neutral colour to help the home appeal to the widest range of buyers
- Improving the energy efficiency of a home
Don’t forget that exterior updates, such as landscaping, can also go a long way to improve curb appeal and help your home appear more welcoming and inviting to buyers. If you feel that a Tandia MeritLine could be a good option for you to help maximize your home’s potential, get in touch with us. We are with you every step of the way. Happy house hunting!
