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A new furnace can cost up to $10,000, which may be more than you have in the bank right now. You will incur additional charges if you need a new air conditioning system, ductwork or anything else to bring your HVAC system up to code. Fortunately, it may be possible to finance a new furnace, air conditioner or other HVAC equipment so that you don’t have to drain your savings to improve your home.
Skip the Interest Payment
If you finance the purchase through your preferred contractor, you may be able to do so at no interest. This means that 100% of each payment you make will go toward the principal balance on your line of credit. Although you can finance a home improvement project using a home equity line of credit (HELOC), a personal loan or a credit card, you will be charged an interest rate of between 5% and 20%.
Immediately Reduce Your Utility Bills
Financing a new HVAC system means that you get to reap the benefits of products that are likely more efficient that what is currently in your house. That means you can make payments over time while lowering your heating and cooling bills right away. You can also reap the benefits of new or cleaner ducts today as opposed to having to wait several months. In fact, the savings that you incur today may be used to pay off your purchase.
Don’t Take Equity Out of Your Home
Obtaining financing through a contractor means that you don’t need to take equity out of your home to improve it. There is also a chance that adding a new furnace, central air conditioner or new ducts can improve the value of your home, which means that you can actually increase the amount of equity it has. Even if these upgrades don’t make your home more valuable, they will typically make it easier to sell if you’re planning on putting it on the market in the near future.
Don’t Worry About the Down Payment
If you were to pay your contractor directly, you would typically pay for half of the project before work begins and the other half after you signed off on the completed work. This means that you might need to come up with $5,000 today and another $5,000 in several weeks after the new HVAC system is in place.
When you opt for HVAC financing, you usually don’t need to make a hefty down payment or provide any money when the project is finished. Instead, you simply wait for your first billing notice and start making payments as instructed. If you choose to get financing through the team at On Time Experts in Dallas, TX, you’ll know exactly how much you’ll pay ahead of time. You can also get information about how to pay your bill on time.
You Get What You Need
Paying for an HVAC system up-front may mean that you have to choose between the best product for your needs and what you can afford. It might also mean that you choose between buying a system that will last for years to come or simply continuing to maintain what you have now. Typically, it is less expensive to make repairs on an existing system than it is to fully replace it. However, over time, repairs can become more expensive than putting in a new system that won’t need as much maintenance.
You’ll Likely Qualify for a Home Improvement Loan
A home improvement loan is typically secured by your property much like a mortgage or a car loan. Therefore, the lender has a greater likelihood of getting its money if you miss a payment or two. Ultimately, this means that you have a greater chance of getting approved for the loan even if your credit score is average or if you have recent blemishes on your credit report. If you are using a personal loan, credit card or other type of unsecured loan product to improve your home, it may be tougher to qualify.
Having Options Is Key
Generally speaking, our team is able to offer financing that offers competitive interest rates and other terms. However, you do have the option of working with an outside party to obtain the money needed for your upcoming project. For instance, you may decide to put the cost of a new furnace on a credit card that offers 0% financing for 18 months in addition to cash back and other perks.
You might also decide that a HELOC is in your best interest because you’ll have several years to repay what you owe as opposed to as few as 12 months. A HELOC may also offer tax advantages that traditional HVAC financing may not offer, which can help you save money now and in the long run.
Don’t Derail Your Other Financial Goals
Even if you have money in the bank, financing a new HVAC system can be a good idea, as it allows you to retain your financial security. You never know when your car might need repairs or you might have an unexpected medical expense that you might not be able to finance. If you have kids, it’s important to make sure that you have an emergency fund available to cover anything that might happen to them.
Keeping money in your bank account ensures that you won’t miss a credit card payment or some other obligation that comes due before your next paycheck. If you are self-employed or a seasonal employee, keeping money in the bank can also ensure that you can buy food or cover other expenses on an irregular income.
You Can Pay Early If You’d Like
Generally speaking, you can pay an HVAC loan off early if your circumstances change. For instance, you could choose to put a tax refund, bonus or other windfall toward the loan without incurring any type of penalty. In fact, financing your purchase may be ideal if you were planning on using an upcoming refund or bonus for a home improvement project but need to upgrade today.
This also means that you can sell your house and use the proceeds to pay what you owe without triggering any type of penalty. As a general rule, proceeds from the sale of a home will first be applied to lienholders or others who have an interest in the property. You would then be entitled to anything that is left over after those payments are made.
Our pros at On Time Experts can help with your air quality or plumbing needs. We can install a new water heater, install an air purifier or take other steps to keep your home feeling comfortable and clean throughout the year.
If you are interested in financing your next AC installation or heating installation in Dallas or the surrounding area, contact our team at On Time Experts today!
