You have finally decided to build your dream garage. You have done all the research and have found the perfect plan and contractor. Your next big step is to get the garage financing you need. Building a garage is not cheap, and you probably don’t have the money just lying around. So, how do you go about getting financing for your garage? These simple steps will help you get the financing you need.
Estimate Your Cost
Before you contact any lenders, you will first need to estimate the total cost of your garage. To get an estimate, you will need to ask a couple of different contractors for bids. Each bid you get should be broken down into individual costs. After getting your bids back, you will want to go with the one you like the best. You should know that any price you get at this point is an estimate and could change during the building process. It is best to add 10% to all estimates to get the best idea of overall cost. If you are going to build the garage yourself, then the estimation process will be a little different. To estimate your do it yourself garage, you will want to go out and look at costs for materials, equipment, and permit fees. In this case, you will want to add 20% more to your estimate.
Improve Your Credit
Having bad credit means you will get a bad loan with a higher interest rate. If you are unsure what your credit score is, then you should have a credit check completed on one of the credit check websites. If you have bad credit, you should try to improve it before applying for a loan. To improve your credit, you need to pay your bills on time and pay off any personal debt. You do not want to apply for a loan only to get turned down due to your bad credit.
Two Different Forms of Garage Financing
There are a couple of different options when it comes to garage financing. The two options are a home equity loan or a line of credit. The big difference between the two is how you want to receive your money.
- A home equity loan is often referred to as taking out a second mortgage. You are borrowing against your house and get the money in a lump sum
- Opening a line of credit is revolving. You withdraw money as you need it. You have to qualify for a line of credit. If you don’t have any equity in your home or have negative equity, you may get denied.
Finance Your Garage
Garage financing should not be a difficult process. If you do your research and ensure you have good credit, then taking out a loan should be a smooth process. A key step in getting financing is having a garage plan. For all your garage plans, check out Behm Design. Behm Design has all different types of plans to select from.