How to Make Your New Roof Affordable

A new roof is expensive. Find out how to finance getting a new roof installed to make it more affordable

The avatar of Rachel Polant

Rachel Polant

Dec 2

Putting a new roof on your house doesn’t need to cost you the roof over your head.

Making the decisions to have a new roof installed is stressful enough, add roof financing to the mix and it can produce outright anxiety. Just like navigating and choosing from the many different types of roofing material for your home, you also have to choose from the many different loan types available to homeowners for home improvements.

Being able to finance a roof can save many homes from falling into total disrepair. Letting a failing roof further decay atop your home because you can’t afford roof replacement is a position no homeowner wants to be in. It ultimately increases the cost of repairs due to roof leaks, causing water damage inside the home as well as expensive structural damage beneath the roofing shingles.

The good thing is, there is no need to put off a new roof installation. Most homeowners have options available to them.

If you need a new roof, don’t put it off — here are a few roof financing options to consider:

Credit Cards:

The good thing about credit cards is they are usually already occupying a few slots in your wallet. The strike against using your credit card to finance a roof is the amount of interest you will pay. Credit cards have higher interest rates than most other loans. And, you run the risk of getting stuck paying only the minimum balance for years and years. By the time you’re done paying off that credit card, it’ll be time for another roof. If you can swing a 0% interest card and solely use it for the roof, then this might be a good option. But a word of caution, if you are not very disciplined and use the credit card for other purchases or can’t pay off the balance in a year’s time, then you risk getting slammed with a huge payment due to accumulated interest at the end.

Home Equity Line of Credit or Home Equity Loan:

Both are types of a second mortgage. A HELOC allows a homeowner to take out a line of credit, using the home as collateral. It’s a secured loan that lets you tap into a revolving credit line to use for large expenses or pay off credit card debt, giving you one lower interest rate payment. Plus, it is tax-deductible.

You can borrow as much or as little you want to within the draw period, which is anywhere from 10–20 years. After the draw period, the repayment period begins.

The downside of a HELOC is that, well it’s an equity loan, so you need to have enough available equity to make it a feasible solution. Lenders will only let you borrow up to 85% of your home’s equity. Once you add in the fees and the cost of the home appraisal, it might not be as much money as you had hoped—the average cost of a new roof is $14,276.

Also, as I said earlier, your home is the collateral. You risk the loss of your home through foreclosure if you can’t make the payments. What’s the point of a new roof if you don’t have a home? And, as HELOCs rates are variable, it’s hard to budget for the payments. You have no way of knowing in advance if the payment will adjust higher and by how much. Because life is unpredictable and the job market can be difficult, you really need to think hard if a HELOC is the safest and best bet for your roof financing.

A home equity loan is very similar to a HELOC except that it is a fixed-rate loan and you get the money in one lump sum. The fact that it’s a fixed rate makes it a more stable and safer choice than a HELOC, but your home is still tied up as collateral. Plus, the application and dispersal time can take quite a while, and if time is a factor in your roof replacement, you might not be able to wait for a home equity loan.

Unsecured Personal Loans:

Like any form of credit, a personal loan’s interest rate is determined by a person’s credit score, which ranges from 300–850. The better your score, the better your rate and the cheaper your payment.

And, a personal loan has better interest rates than a credit card — 7% to 10% less — but not as low a rate as a home equity loan because your home isn’t on the line if you should fail to make the payments.

Another plus in the personal loan column is that the funds disburse quickly and no extra steps like a home appraisal are required. This means you can purchase and install that new roof quicker, cutting down on the time your home is exposed to the danger of becoming seriously damaged.

The credit criteria for a personal loan is fairly flexible, often allowing for scores as low as 600. So, if your credit has had some bumps and bruises, you are still able to get a new roof without scrimping on the quality of material or skill of the roofing contractor. Going cheap only saves you money initially, but will cost you more on repairs or replacement and higher energy bills in the long run. Installing your roof right the first time using top, energy-efficient materials will save you money over the years.

Government grants and incentives:

One other option to look into is governmental grants and incentives. These programs can be a great supplement to roofing financing, bringing down the amount you need to borrow. These programs are great for people interested in more eco-friendly, environmentally sustainable roofing materials.

Find roofing contractors who are licensed and insured to install your roof

If you need a new roof and want to explore roof financing options, service.com can help! Connect with us to find the best roofing companies for your project. Get your free roofing quote today!

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