Roof Replacement Cost: 5 Ways to Pay for It

If your roof is in disrepair, you face an expensive repair. According to Home Advisor, replacing a roof costs an average of $ 7,336.

Most Americans don’t have nearly as much savings. Without that type of money in the bank, you will have to use other financing options to cover the cost of roof replacement.

Factors that affect the cost of roof replacement

When installing a new roof, many factors affect the price you pay.

  • Time of year: According to Angie’s List, late summer through fall is the busiest time of year for most roofers. If you want your roof to be installed during this period, you will likely pay an additional fee. In contrast, you might get a cheaper price if you opt for winter or early spring.
  • House size: Roofers usually set the price on the roof calculator based on the square footage of your roof. The bigger the house, the more you pay.
  • Materials: If you choose an asphalt roof, you pay much less than you would with metal or wood.
  • Job: Each roofing company charges different hourly rates for work, and rates can vary widely.
  • Available: The roofer also charges a disposal fee to rent or deliver a dumpster for the old roof and supplies.

This is how you save on a new roof

Follow these tips to minimize how much you need to borrow to save money on roof replacements.

  1. Shopping spree: Make sure you get quotes from multiple companies before moving on to a roofer. Costs can vary widely from company to company, and you may find a cheaper roofer who can provide high quality results. If you’re not sure where to find reputable companies, start your search on Angie’s List.
  2. Consider cheaper materials: While a metal roof may look beautiful, it is much more expensive than some other materials. If possible, opting for an asphalt roof can save you money.
  3. Time it right: If your roof doesn’t need to be replaced right away, waiting until winter to have it replaced can save you a lot of money.

5 ways to pay for a new roof

While replacing a roof can be expensive, there are ways to fund the project to make it more affordable. Here are five of the most common options.

1. Insurance coverage

If you have homeowner insurance, you may be able to use your policy to cover the cost of a new roof. According to Esurance, many insurance policies cover roof repairs or replacements if it has been damaged by storm, fire, or theft. However, if your roof is deteriorating due to age or lack of maintenance, your insurance company will not replace or repair it.

Check with your insurance agent to discuss your policy and the repairs or replacements needed to see if the insurance will pay for them.

2. Roofers payment plans

Some roofers offer payment plans to make roof replacement costs more affordable. This option allows you to spread your payments over several months or even years. Most plans charge you interest, which can add to the total cost of your roof replacement. So make sure you are familiar with the interest rates and monthly payments.

Every roofer has their own plans, requirements, and interest rates. So, get in touch with the roofing company you choose to find out what is available.

3. FHA Title I home loans

If your roof is in need of major repairs or a replacement, the best way to pay for it is a Title I Home and Real Estate Improvement loan. The Federal Housing Administration (FHA) runs the Title I loan program and insures the loans, reducing the risk for lenders.

If you own a single family home, you can borrow up to $ 25,000 under the Title I program and have up to 20 years to pay off.

Note, however, that loans above $ 7,500 must be secured by either your mortgage or a trust deed on the property. If you default on your payments, the lender can seize these assets.

Title I loans are offered by banks and credit unions. Each lender has their own requirements and interest rates. It is a good idea to consult multiple financial institutions to make sure you are getting the best deal. Use the US Department of Housing and Urban Development’s locator tool to find an approved Title I lender near you.

4. Home equity

With equity built up in your home, a home equity loan can be an inexpensive option to pay for a new roof. You work with a bank or financial institution and use your home’s equity as collateral for the loan.

Your home’s equity is its current value minus the amount you owe on your mortgage. For example, if you have a $ 250,000 home home and you owe $ 180,000, your home equity is $ 70,000. You can typically borrow up to 85% of your home equity, according to the Federal Trade Commission. So with a $ 70,000 home equity, you could borrow up to $ 59,500.

However, there are some drawbacks to home equity loans. Since the equity on your home is used as collateral, if you default on your payments, it has dire consequences. You could even lose your home. To minimize your risk, borrow as little as possible to cover the cost of roof replacement and make sure you can afford the monthly payments.

5. Personal loan

If the above options don’t work for you, another way to pay for a new roof is to take out a personal loan. With a personal loan, you work with a bank, credit union, or other financial institution to raise loans of up to $ 100,000.

Typically, when taking out a personal loan, you do not need to offer any collateral so that you do not have to put your home or other valuables at risk.

However, consider some of these drawbacks with personal loans:

  • Shorter loan terms: Personal loan terms are typically shorter than other types of home improvement loans. For example, you can have up to 20 years to repay a home loan. Most personal loans, however, have to be repaid within two to five years. That means you have higher monthly payments, which can be a drain on your budget.
  • Higher interest rates: Although you will see some personal loans with annual percentages (APRs) as low as 2.49%, lenders reserve these interest rates for borrowers with excellent credit scores and incomes. If your credit score is good or lower, you could end up at a much higher rate. With bad credit, you could pay an interest rate of up to 199.00% on your loan.

A personal loan makes sense if you have good credit and can easily afford the payments with a shorter repayment period. If you think this option is right for you, get quotes from low interest lenders.

Repair your home

If you need a new roof right away, the price can be prohibitive. However, there are funding options that can help manage costs better with your budget.

Interested in a personal loan?

LendingTree allows you to compare the interest rates of multiple lenders by filling out a simple form. How Student Loan Hero is Paid

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How Student Loan Hero is Paid

How Student Loan Hero is Paid

Student Loan Hero is rewarded by companies on this website. This compensation may affect how and where offers are displayed on this website (e.g. the order). Student Loan Hero does not include all lenders, savings products, or loan options available in the market.

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Student Loan Hero is an ad-supported comparison service. The website contains products from our partners as well as institutions that are not advertising partners. While we strive to provide the best deals to the general public, we do not guarantee that this information represents all of the products available.

PRICES (APR) Loan amount
5.99%. – 19.16%.1 $5,000 to $100,000
8.27%. – 35.99%. $1,000 to $50,000
6.94%. – 35.97%.* * $1,000 to $35,000
99.00%. – 199.00%.2 $500 to $4,000
5.99%. – 24.99%.3 $5,000 to $40,000
7.99%. – 29.99%.4th $7,500 to $40,000

NMLS # 1136: Terms and Conditions apply

1 Includes AutoPay discount. .
2 Includes AutoPay discount. .
3 Includes AutoPay discount. .
4th
*.

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