Best Loans for Kitchen Renovations in Ireland

Kitchen remodelling is quite daunting as it consumes a lot of money. The remodelling project could be exorbitant depending on the degree of renovation. When it comes to funding kitchen remodelling, the best funding source is your savings, as they do not charge interest. Unfortunately, a refurbishment project does not fit into the earmarked cash you have. Here comes the role of low-interest home improvement loans. 

What are home improvement loans? 

Home improvement loans are personal loans that you take out to carry out renovations. The loan amount varies between €5,000 and €15,000, to be paid down over an extended period. Depending on your repayment capacity, the repayment length will vary. However, it cannot be more than five years.  

It is not guaranteed that all lenders will be comfortable lending you up to €15,000 without collateral. Every lender has their own criteria to assess risk, and in order to mitigate their risk, it can demand security. Some lenders do not offer more than €10,000 without collateral.  

• You will be able to qualify for lower interest rates if your credit history is stellar. 
• Every month, you will pay down a fixed sum of money. 
• These loans can boost your credit score if discharged on time. 
• Missed payments can ruin your credit score as well.  

You should do research before applying for personal loans in Ireland to fund the renovation cost, because most lenders might not feel inclined to accept your demand as the risk is too high without collateral.  

What other loans can you use for kitchen remodelling apart from personal loans? 

It is not a cinch to have your application approbated for a personal loan, but fortunately, there are several other loan options that you can consider: 

Home equity loans 

Home equity loans are secured loans. They enable you to borrow money against the value of equity you have built in your property. It is not plausible to borrow against the full equity, as most lenders cap on 60%. They are particularly useful for large renovation projects.  

Since your house will be secured against the equity, you will be able to qualify for lower interest rates. Payments will remain fixed throughout the loan term, so you can easily budget around them. 

Secured home improvement loans 

Lenders also provide secured home improvement loans. If they suspect your repayment capacity, you can consider securing them against your house. Most of the lenders hesitate to sign off on unsecured loans for renovation, but your chances of getting approved for a renovation loan immediately become high when you secure it.  

• One of the advantages of considering secured home refurbishment loans is that they come with lower interest rates.  
• Another advantage is that they will let you borrow a large amount of money. Secured home improvement loans could potentially be an ideal choice if a kitchen remodelling project costs too much.  

However, it is worth noting that you will lose your house if you fail to abdicate responsibility.  

Credit union loans 

Credit unions might not be able to furnish you with a large amount of money, but they could be the best bet for small renovation projects. If your savings have fallen short of cash, you can fund the gap with credit union loans.  

• Loans from credit unions charge very low interest rates. They are more affordable than other types of small unsecured loans.  
• However, you must be a member of a credit union to qualify for a loan.  
• The APR of credit union loans could be up to 9%, which is way cheaper than personal loans.  

Credit union loans are mainly suitable for small renovations. They do not provide a large amount of money.  

Things to do before applying for home improvement loans 

You cannot afford to throw caution to the wind while applying for a loan. Do not forget that loans are expensive, and they can be a bit exorbitant if your credit score is not up to snuff.  

• First, you need to identify how much money you have to pay for the renovation. Having clarity about your savings will let you know how much money you need to borrow.  
• Get multiple quotes to know how much kitchen remodelling will cost you. Once you have clarity about it, you can easily determine how much money you need to borrow. 
• Check your eligibility. For instance, some lenders do not accept applications from subprime borrowers especially if the loan amount is large. There is no point in applying to a lender whose acceptance criteria you do not meet.  
• Compare annual percentage rates (APRs). They vary by lender. Choose a lender who offers the most affordable rates.  
• Check your credit score. Your credit score should be decent to be able to qualify for lower interest rates.  

How to turn kitchen renovation financing to your favour 

If you want to make the most of kitchen remodelling financing, you should consider the following tips: 

• Do not rely on a single financing option. Mix your savings with loans and government grants. However, make sure that you are eligible for government grants and schemes to refurbish your house. 
• Try to negotiate with contractors. When you get multiple quotes, it becomes easy to know the lowest possible market price, and then you can better negotiate for it. This will help reduce your loan amount.  
• If you choose a green renovation project, you will be able to get a large amount of money at the lowest possible rates.  
• Do not be under the impression that all renovation projects can increase the market price of your property, so try to stick to those that align with value increase.  

The final word 

For kitchen renovations, the best loan is a personal loan, but it is not easy to qualify for. They charge high interest rates as they are unsecured. You can consider other loans for renovations, such as home equity loans, secured home improvement loans and credit union loans.