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Pool Financing: Get Loan Know-how
Do you want to borrow money for your swimming pool construction or
renovation?
Most financial consultants are witness to many who went into debt and
lost their properties, including their homes, because they could not pay
back their loans.
The problem is that borrowers mortgage the very house they live in and
it gets foreclosed. This is a very traumatic experience for the family,
especially for the children.
Hence, if you are planning to seek some financing for your swimming pool
construction or renovation, it is best that you learn what to consider
first before getting a pool financing.
Here are some questions you have to ask yourself so you can avoid
falling into the same trap.
1. Do I really need to borrow money?
Exhaust all financial reserves before you turn to loans. Even if most
pool financing companies would readily provide you the loans that you
need to fund your swimming pool project, it is still best to use all of
your available financial resources before you decide on getting pool
financing.
In most cases, people realize that they do not have to borrow at all.
After exhausting all possible sources of funds, some people realize that
the loan is not actually necessary.
If you are thinking of getting a pool financing, it is best that you
define your needs. Do not borrow on a whim. There should be a need,
because it will cost you more money to pay it back.
Financial experts say that some people borrow money so they can keep up
with their extravagant lifestyle. For example, cars are not
income-generating. You will be popular for such a short time, but you
have to think abut maintenance and gasoline, too. It is like double
jeopardy if you do not have the money to pay back the loan.
With pool financing, you can still retrieve the money that you have
invested in your swimming pool because it is a home improvement. Experts
say that any form of home improvement will augment the resale value as
well as the price of one’s home.
This goes to show that even if you opted for pool financing, you can
still get back what you have paid for because you can sell your house at
a higher rate.
As a rule, it is best to borrow to invest and save to pay for expenses,
especially non-essentials. The rule makes sense. Why? Because in
exchange for the loan, you get something of value—which will allow you
to make money from or which you can sell if the need arises.
Keep in mind to always base you decisions on facts, not guesswork.
2. How much money should I borrow?
Financial experts warn against borrowing too much. The amount that you
borrow should be commensurate to your personal assets and fixed assets
acquired for business, if any.
In business terms, this is called debt-equity ratio. A debt-equity ratio
of one to one is best. This means that if you borrow $10,000, then you
should have assets or equity worth $10,000. A ratio of two is to one is
still safe—meaning if you borrow $10,000, you should have $5,000. Beyond
that, you should be careful.
In case of pool financing, construction of swimming pools are regarded
as home improvements. Hence, financial experts believe that the expenses
are worth it because this kind of home improvement can increase the
value or resale value of a certain house.
3. Where should I borrow?
According to financial experts, the bank is still your best bet when it
comes to financing. But which financial experts are these?
However, when it comes to pool financing, it is better
to seek the help and advice of pool builders and of finance
companies who specialize in swimming pool loan brokers who will give you
free advice. When it comes to pool loans from a bank, consider the
fact that banks seldom offer fixed rates as they usually do NOT take into
consideration the value a pool adds to your home.
Commercial banks can manage to charge lower interest rates than rural
banks because they are the bigger players in the market.
Then again, pool builders that can provide pool financing assistance is
still a better choice. Just think of it, banks can deal with pool
financing assistance once in a week while pool builders deal with it
almost every single day.
So the next question is: Are you qualified to get a pool financing? Keep
in mind that pool financers always look at three C’s: character,
capacity to pay, and collateral.
Call Lyon Financial at (800) 262-1655 or fill out our
online secure Pool Loan Application 24 hours a day:
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