Loans for smaller works

The weather is starting to warm up with summer just around the corner. Thoughts drift to days lounging by the pool and nights whipping up a fresh salad or enjoying a crisp glass of wine at home…except you haven’t gotten around to installing the pool you’ve always dreamed about, and your current kitchen is dark and gloomy.

Renovations can be costly, yet they’re worth embarking on if they’ll add value to the home and help you enjoy your living space more.

Pools are up there when it comes to expensive investments. Yet there’s no doubt they bring lots of joy to their owners—who doesn’t love splashing around in their own backyard, away from the beach crowds and packed public pools? They also have the potential to add value to your home in the long-run. Australians love spending time outdoors, and 12% of the population already have their very own pool.

To be able to afford one, speak to a pool builder and advise your client to do their own research to find out how much money they’ll need. As a general guide for in-ground pools, fibreglass models will set them back anywhere between $6,500 and $75,000, and concrete pools cost around $35,000 to $100,000 ($50,000 is the average).

As for kitchen renovations, a 2015 study by the Australian Institute of Architects found that on average, a basic kitchen renovation costs just over $23,000. For a premium renovation, expect to pay around $69,000.

If the pool or kitchen reno plans are at the more conservative end of the price range, your client may be tempted to use a credit card. While it’s a convenient and quick option, a personal loan comes with other benefits. Personal loans have a lower interest rate than credit cards, and the funds are directly deposited into your bank account so you’re good to go.

However if your client is needing a significant amount of money, consider a construction loan instead. It will be their go-to option should they be doing any significant structural changes. Be aware that these kinds of loans can be more expensive and you won’t receive the full amount upfront. They’ll be paying the builder and other contractors only as they complete the work, as the payments will only be received from the lender at certain phases of the construction process. The good news is that they will only be charged interest on the amount drawn down, instead of the total.

Other ways to get the money they need are to refinance their home loan or to use the home’s equity. While refinancing can seem like a complex process, it can be easier than they may think and their broker or lender can step them through it.

Whichever way the funds are secured, being able to add to their home and enjoyment is undoubtedly worth it. Whether it’s a new kitchen or a swimming pool in mind, get started soon to make the most of it come summer time.