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Five Ways to Pay for a New Roof | Austin, Texas

Five Ways to Pay for a New Roof | Austin, TexasReplacing a roof can be an expensive proposition, but it is a necessary expense. You can likely postpone remodeling your kitchen or adding a sunroom until you have saved enough to pay for the project. However, as any licensed roofing contractor can tell you, a compromised roof can jeopardize the structural integrity of your entire home. Fortunately, there are various ways to pay for a replacement roof. Here are five methods that homeowners commonly use to pay for the project.

Five Ways to Pay for a New Roof | Austin, Texas

1. Homeowners Insurance

Check your insurance policy to determine the details of your coverage, including your deductible. Most policies will not cover a roof that needs to be replaced simply because it is worn out. However, if your roof replacement is necessary because of circumstances beyond your control, your policy may cover all or part of the costs. For example, if your roof is battered by hail, struck by lightning, or damaged by strong winds, you should be covered. If a tree on your neighbor’s property drops a large limb on your roof, your insurance company may pay for the roof repair or replacement; the company may then seek reimbursement from your neighbor or his insurance company. You may also be covered if your roof is damaged by vandals or others committing a criminal act on or against your property. However, since policies vary widely, you should review yours carefully and consult your insurance agent for advice.

2. Credit Card

Virtually every reputable Austin roofer accepts at least one or two of the four major credit cards. If the credit limit on your card is sufficient, you can use it to pay for your replacement roof. If your limit is insufficient, you might be able to obtain an increase in your credit line. However, it would be best if you considered the interest rate; some cards carry a high rate that could add up to a significant amount of money by the time you retire the balance.

3. Savings

If you are fortunate enough to have an emergency fund or savings account, you can pay your roof contractor out of your pocket. This lets you avoid paying interest to a financial institution. Instead, you could pay the interest to yourself by making monthly deposits to replenish your savings account that includes an adjustment for any interest you might have lost by tapping into your savings.

4. Home Equity or Home Improvement Loan

Many credit unions and banks offer both of these types of loans. A home equity loan requires your home to be worth more than what you owe on it. The difference between your home’s current value and your mortgage balance is your equity. Typically, most home equity loans cannot exceed 85% of the home’s equity. These loans are collateralized, which means that your equity secures them. Should you fail to make your payments, your lender could place a lien on your home or foreclose.

Home improvement loans, especially the Federal Housing Administration’s Title I property improvement loans, can be an excellent way to pay for your new roof. However, if the loan is for more than $7,500, it typically must be secured by your deed or mortgage. If you default on the loan, you could face the same consequences as those for defaulting on a home equity loan.

5. Personal Loan

Personal loans usually are unsecured, which means that you do not have to provide collateral that the lender could seize if you default. If you choose to take out a personal loan, make sure that you work with a credit union, bank, or another reputable lender. Because the lender has little more than a signed contract to guarantee repayment, personal loans tend to carry higher interest rates than most home equity or home improvement loans. They also tend to have much shorter terms, often no more than five years. The combination of a shorter repayment term and a higher interest rate means that your monthly payments may be substantially higher than you would pay if you secured a different type of loan.

Alpha Is the Roof Contractor Austin Homeowners Trust

Whether you need a roof replacement, an emergency roof repair, or another roofing service, you can count of Alpha Roofing for prompt, courteous attention and high-quality work. We are an award-winning Austin roofing contractor serving homeowners throughout Central Texas. Our residential roofing services include metal roofing systems, asphalt shingle replacement roofs,  roof repairs, preventive maintenance programs, flashing repairs and installation, and chimney repairs. Contact us for a free quote by calling our office in Round Rock at 512-777-1086 or submitting the online request form.