Expanding Your Home’s Square Footage: Increase Value and Enjoyment for DFW Homeowners: Part 4 (Financing options for adding square footage)

Homeowners looking to finance their square footage addition projects in the DFW area can consider home equity loans and lines of credit (HELOCs) as viable options. Home equity loans provide a lump sum of money that can be used for home improvements, with repayment structured over a fixed term at a fixed interest rate.?

HELOCs, on the other hand, offer a revolving line of credit based on the available equity in the home, with variable interest rates and more flexible repayment options. Both options enable homeowners to leverage the existing value in their property to fund their home addition projects.

Cash-out refinancing

Cash-out refinancing is another option for DFW homeowners wishing to add square footage to their homes. Homeowners replace their current mortgage with a new, larger loan, allowing them to access a portion of their home equity as cash. Cash-out refinancing can be advantageous for homeowners who can secure a lower interest rate on their new mortgage or consolidate their home improvement costs with their existing mortgage.

Government programs

The Federal Housing Administration (FHA) 203(k) loan program is a government-backed financing option that assists DFW homeowners in funding their home addition projects. The 203(k) program allows borrowers to combine the cost of their home purchase or refinance and their renovation expenses into a single loan, simplifying the financing process.?

The program is especially beneficial for homeowners with limited home equity, as it requires a smaller down payment than conventional loans. The FHA 203(k) loan program also has more flexible qualification requirements, making it accessible to a broader range of homeowners.