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Paying for a Roof Replacement in Ann Arbor, Michigan

Three Ways to Pay for a Roof Replacement in Ann Arbor, Michigan

Owning a home is a major accomplishment that should make you proud. There are a lot of perks to owning a home versus renting one, like gaining equity and being able to alter your home without permission. There are many possible changes you can make to a home to fit your personal tastes and styles in Ann Arbor, Michigan. One of those is replacing the roof. It can transform the aesthetics of your home.

How a roof change can improve your home

An outdated or damaged roof can decrease the happiness you experience in your home for a few reasons. Loose shingles can fall and damage other property. Missing shingles or holes in the roof allow water into the home, eventually causing the wood inside to rot and mold. Water damage is a terrible experience for homeowners. An outdated roof without ventilation can also skyrocket cooling costs in the summer and heating costs in the winter. A fully functional and updated roof is important for homeowners, so most will need to replace their roof in the time they own the home.

A new roof can cost anywhere between $8,500 and $14,300, but the national average cost is around $10,000. However, most people need some kind of financing to replace their roofs, and there are many options available. If it’s time to replace your roof, here are some financing options to keep in mind. 

Homeowners’ insurance may help

All homeowners are required to have homeowners’ insurance on their houses, regardless of whether they have a mortgage payment or not. This coverage is designed to protect you from financial loss from things like theft, fire, or damage from natural disasters. If your roof needs replaced due to damage other than wear and tear, then your insurance may cover the replacement.

To determine if part or even all the repair is covered, you first need to speak with your insurance provider. They’ll discuss with you the total amount covered and how you will receive the payment. Depending on your insurance, it may be possible to connect your roofing company with your insurance company to facilitate seamless payment without you as a middleman.

If there has been damage to your home from hail, winds, snow, or other weather-related events, then your insurance is more likely to become involved.

Home equity loan or HELOC

When you purchase a home and begin making payments, you accrue equity in your home. The equity you have in your home is the difference between the current market value and the remaining amount on your mortgage. A home equity loan or a home equity line of credit (HELOC) gives you the opportunity to gain access to the equity you have put into your home by borrowing against the equity. Because the home is used as collateral for the loan, the interest rates for these loans are typically lower than other finance options. It is important to ensure you can make the payments on these types of loans since your home is used as collateral; you can lose your home if you do not stay current on payments. To use these options, most financiers require a loan-to-value ratio of 85% or less, along with strong credit and steady income.

Finance with a bank loan

If you don’t have enough equity in your home to consider a HELOC, a bank will likely see a roof replacement as a positive investment. That means that they are likely to finance such an expense, especially if the home can be used as some kind of collateral. Be sure to speak with more than one lender to ensure you get the best APR (the annual percentage rate) – the rate you will pay back for the loan. For this kind of loan amount, the lower the APR, the better in terms of your finances. 

Paying for your roof repair

Ultimately, the first step in paying for your roof repair is determining how much the total cost will be. This should be done by speaking with a local roofing company in Ann Arbor, like Mr. Roof, to determine the cost of your roof replacement and the options you have to reduce the cost.

You can also begin looking for this information before you need the roof replacement to give yourself more time to plan. A roof typically lasts anywhere from 20-50 years, so it’s likely you’ll need this information eventually. With the quote, you can approach the plan that is best suited for your needs and get your roof replaced so you can go back to enjoying your home.