How to Finance a New Roof (With or Without Credit) (2023)

Do you want to purchase a new roof for your house? Here are a few ways to finance the roof on credit or without a loan.

Providing a roof for your family under which they can lay their heads under can be an expensive affair. It’s often the most expensive expenditure related to your home over the years.

Most often, one will need to plan well when they want to finance a new roof, to avoid financial strains and future complications.

Due to the substantial amount required, the question on how to finance a new roof is something that many average Americans would want to pass.

Overview of Financing a New Roof

The roof of a house not only provides shelter and security to the house, but it also brings out the beauty and improves the looks of the entire structure. If you want to purchase a new roof, there are few things that you need to consider which may be of great help to your finances.

In this article, I would like us to go through together over some of the best options you a have for financing a new roof.

So, here are some of the ways you can finance a new roof.

Best Ways to Finance a Roof Replacement

These are some of the most proven ways to finance a roof replacement for your house.

1. Cash Savings

Although many may see this as an impossible one due to the cost of a new roof, I consider this to be the best option. If you anticipate that your roof will require a make-over in the next few years, it’s always good to plan and start saving.

The average cost for a new roof can start from $5,000 and go even up to $30,000. For this reason, it is wise to start saving for it way in advance so that when the time comes for the replacement, your finances will not suffer a big blow. Even if you can save up to the half of that amount, it will be a great relief for you since you’ll need to look for the top up.

This financing option saves you money since you don’t pay any interest charges that you may incur when using other forms of financing like personal loans and mortgages. You can decide to put aside some fraction of your income to cater to this anticipated expense.

Even saving a few dollars like $100 per month, can have a great relief on the total cost of the new roof.

(Video) Roof Financing Options

The best way to avoid a big blow is to have an emergency fund set up from the beginning. It’s as simple as that.

Use a tool like Personal Capital to monitor your finances and cash flow. It’s completely free and they will give you a free investment consultation when you link your accounts.

2. Company Financing

In this option, the company doing the roofing for you collaborates with a bank of their choice to cater for the cost of the roofing. The financing will depend on the value of your new roof and also your budget.

Different financing companies will work with various banks and may they also have varying new roof financing options that fit their customer needs.

Unlike direct-lender financing, financing may offer a lower interest rate to the customer. The company gets special rates from the bank since they provide large businesses to these banks. As a result, the company can pass down this benefit to its customers to increase lending volume. Examples of such roofing companies/contractors include Home Depot, Long Roofing, Tecta America Corporation, Flynn Group of Cos. and more.

The financing companies offer competitive payment factors, as well as interest rates in the market. Most financing companies will offer to finance from a minimum of $5000 with interest as low as $12.50 per month for every $ 1000 that is funded.

These companies give you peace of mind as you contemplate on how to finance a new roof.

How Home Depot Roof Financing Option Works

If you need that replacement and don’t have any cash, Home Depot roof financing can be an excellent option for you. Home Depot offers a consumer credit card that helps the cardholders to access numerous unique financing options.

Using the Home Depot consumer credit card, the card user gets special financing on roofing that is spread over a 12 months payment schedule.

The company will finance up to $5,000 plus of the cost, and you can comfortably replace your roof. The special offer comes in handy when you need that new roof or any other major home renovation, but you lack the upfront funding capability.

Home Depot can be a great choice when looking at how to finance a new roof, but before you get into that contract, you should also understand some concepts.

For example, the difference between terms like “zero interest when paid in full within 12 months” and zero interest for 12 months”.

The former implies that if you pay the whole amount within 12 months, you pay no interest but if you fail, you incur deferred interest. Most of the special financing offers will have deferred interests, and therefore it is crucial to keep your end of the bargain, less you incur extra charges.

(Video) How can I pay for a new roof with no money?

Home Depot also offers a Home Depot Project Loan Card which is intended for individuals who require financing for big projects. The card is typically a Mastercard that extends a consumer loan to the cardholder from Home Depot.

This line of credit can be ideal for you if you need a roof and it has a credit limit of up to $55,000.

With this card, you will have a six months purchase window, fixed 7.99% APR and it has no annual fees.

3. A Credit Card and Home Equity Line of Credit (HELOC)

For individuals who qualify for a new zero-interest credit card, this may be an ideal option for a 0% roof financing. Check your credit score with Credit Sesame to understand if this an option for you. It’s completely free and if you use my link, they will give you free identity theft insurance.

When you decide to use this method though, you should altogether avoid charging anything extra on this card.

The option also requires you to repay the financing in one year and therefore, you should spread this cost throughout a 12 monthly repayments schedule. If well planned, this method could be an excellent option for new roof financing.

When it comes to HELOC, it implies to a line of credit that uses your home as collateral for the funding.

Home Equity Line of Credit, is only available to cater to significant expenses such as medical bills and home improvements. HELOC is a good option for financing your new roof replacement.

If you get overwhelmed by your credit cards, use our free credit card tracker.

You can download the completely free credit card tracker below. Get started on tracking your credit cards in a more efficient manner.

4. Pay Using Insurance

Every homeowner, require property insurance for their home. Homeowners insurance is a form of cover that takes care of losses incurred from incidents such as fire, theft or any other damages which may include natural disasters.

If you have such an insurance cover, you can use it to replace your roof for a new one in the event of such incidents as stated in the policy. The only drawback of this option is that it can only be used in the case of an accident but not from wear and tear causes.

If you qualify for roof replacement covered by the policy, getting in touch with your cover provider is the best thing to determine what to do. Some companies can even provide a connection with your roofer to allow a seamless payment process for the replacement.

(Video) Can A New Roof Be Financed

This cover may save you a considerable amount if only you are deemed eligible for the same. The policy takes care of various damages to the insured property including interior and exterior damages, loss or damages of personal belongings or injury arising while on the property.

When you claim any of the said incidents, your insurer will cover for the total cost of the damage, less the deductible amount. The deductible is the amount which you as the owner, will have to pay from your pocket to cover for the cost.

For example, if the insurer estimates that the cost to replace your roof is $8000, and the deductible is $2,000, the insurer pays $6,000. With this policy, it means that the lower the deductible on a contract, then the higher the monthly or annual premium on the policy and vice versa.

The standard liability limit is generally set at $100,000, although a policyholder can choose a higher limit.

See Related: How Much Life Insurance Do You Really Need?

5. Home Equity Loan

Another option when considering how to finance a new roof would be acquiring an equity loan to help you cover for the cost. This method allows you to get a loan against the equity that you have built up in your home during a period.

Home equity refers to the difference between your home’s current market value and the amount still unpaid on your mortgage. It is the part of your home that you actually “own.”

In case the loan-to-value ratio on your home is less or equal to 85%, you can apply for the loan for your roof.

Since the home acts as the collateral for the loan, the interest charged on loan may sometimes be lower than that of other financing options. Reason being that it reduces the aspect of risk exposure in case of default payments.

Some drawbacks of this option include the fact that you must have a strong credit rating, have available equity on your home and also have a steady income to be eligible. When you need a loan for roof replacement, home equity is among those many options you can explore.

6. Personal Loans

“What options do I have for financing my roof?” This was a tricky question for me when a friend called me to get an opinion for his roof replacement. Taking a personal loan was loan was one of the options that were right just in my mouth.

Although there are other roof replacement financing options to consider even with bad credit, in some cases, a personal loan is just the savior for the day. If you qualify for a personal loan, you may find yourself getting a loan amount that will fit your roof financing needs and at most favorable interest rates.

In this type of financing, the interest rates, as well as the amount you can get depends totally on your credit score and payment history. Various lenders will be willing to advance you a loan as long as you are creditworthy and can repay.

(Video) How Do We Pay For A Roof While Paying Off Debt?

Most of these lenders will not even require security for some specific amounts of loans and may prove to be one the quickest mode of acquiring cash.

One of the positive aspects of this financing option for your roof is that you can get a more extended repayment period. With a longer repayment term, it will result in lower installments per month thus reducing the burden on your finances.

Before signing any agreement anyway, you should do proper research on different lenders and their rates.

You must also read well the terms and conditions of the loan, to avoid getting into a raw deal. So, if you are thinking of how to pay for a roof with no money, a personal loan might be the answer.

See Related: How to Pay Down Debt Efficiently

Essential Things to Consider in a Roof Financing Option

All these financing options are good and have different advantages and disadvantages. Because of this, it is wise to consider some factors before deciding on which financing method to pursue.

The first thing I would recommend you to think about and research on is the interest rates of the different lenders. Different financiers will offer varying interest rates, and if you don’t do personal due diligence, you might end up not getting the best deal.

The cost of your roofing replacement is also another crucial factor you should never ignore. Knowing the exact or the approximate value of your project will help you decide which path to follow when it comes to financing and makes informed decisions.

You don’t want to run out of money before the project is complete.

The third thing is the cost of your project’s materials in different shops. Make sure that you do extensive research on the amount different companies charge for the same products.

This will enable you to get the most favorable deal around.

See Related: Don’t Be Car Poor, Save Money

Conclusion on How to Finance a New Roof

How to finance a new roof should no longer be a stressful and mind-boggling question. I believe this article has extensively given you the essential things you need to understand new roof financing.

(Video) How to Finance a New Roof

What is your opinion regarding these six incredible new roof financing options? Let us know in the comments below. I’d love to hear from you.

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Can a roof be credit? ›

Yes, you can finance fixing a roof through personal loans and some other loan options. At Acorn Finance, you can check home improvement loan or personal loan offers with no impact on your credit score.

How much is a new roof? ›

As a general guide, a new roof for an older home with a roof size of about 150 square metres might cost about $30,000-50,000. However, replacing a roof might balloon out to $80,000, or even $100,000, with more complicated rooflines and multiple storey buildings.

What credit score is needed for a roof? ›

The better your credit score, the lower the rates you'll pay. You'll likely need a credit score of at least 640 to qualify, but if you're looking for roof financing for bad credit, you may still be in luck. Some providers may qualify you with a credit score as low as 500.

Is there a tax credit for a new roof in 2022? ›

Previously, it allowed homeowners a federal solar tax credit for roof replacement. This equaled 30 percent of the cost of installing a solar energy system on their home. As of 2020, the deduction dropped to 26 percent. In 2021, it will become 22 percent, and from 2022 onward, 10 percent.


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