Should You Take Out a Loan to Improve Your Yard? What to Consider Before You Borrow. – NFCC
Editor’s note: This post was originally published in June 2019.
As summer approaches, it’s normal to look at your lawn and wonder if the grass could be greener. But who has the money to landscape their entire yard or even just treat their lawn? After all, landscaping improvements can come at a high price.
If you don’t have cash on hand, you may be tempted to borrow money for landscaping improvements. However, you need to consider a few details to determine if a lawn loan or landscaping loan is really worth the debt.
Is your landscaping project a want or a want?
Whether you’re looking to renovate, clean, or install a water feature, greening your yard will cost you a lot of green.
Before applying for a loan, ask yourself if the project is necessary and determine the specific benefits. After all, lawn loans and landscaping loans are both considered personal loans, and interest rates can range anywhere from 6% to 36% APR.
If you are going to take on the debt, it is essential to make sure that the work will add utility or measurable value to your property. For example, if you have a small child and your yard is unsuitable for play, adding the right type of fence can increase safety and increase property value. On the other hand, if you install an above ground pool, chances are it will lose value over time.
Will landscaping increase the value of your property?
High quality landscaping can add value to your home. But not all projects will be rewarded. So before you borrow money, ask yourself: If you put your house on the market next year, would this landscaping be a selling point?
If the answer is “no”, then it is not worth going into debt. If the answer is a resounding yes, then you should weigh your options and consider moving forward. Here are some landscaping projects that generally increase property value when done right:
- Improved patio and walkways
- Installation of the irrigation system
- Planting shrubs or bushes in front of windows
- Planting native trees and plants
- Seasonal fertilization and weed control
- Seasonal mulching and pruning
There’s also a chance that new landscaping could save you money. For example, installing water-saving features can save you money on irrigation. For projects that can save you money in the long run, estimate how much you’ll save each month and calculate how long it will take for the project to pay for itself. For multi-phase projects, you may want to borrow a smaller amount for the first phase and then save for the rest.
Regardless of the type of project, you should too review your budget and determine how much you can afford to pay on a loan each month. Next, research how much it will cost to get quality work done. Sure, you can try to do it yourself, but DIY landscaping can lower the value of your home.
What loans are available for landscaping?
Most landscaping loans are offered by credit unions, and credit unions are generally considered reliable lenders. But non-bank lenders also offer renovation loans at different interest rates.
However, many non-bank lenders will charge an upfront fee in addition to interest.
It is best to avoid taking out a high interest loan (anything above 7%). If you can only qualify for loans with higher rates, it’s better to save your money while you work on it. improve your credit scores. Then, once you’re in a better position, you can pay for a landscaping upgrade with cash or apply for a better loan.
Bottom line: Is a lawn loan a good idea?
Whether a lawn loan is worth it depends on several factors. Before applying for a loan, ask yourself:
- Can afford a loan payment?
- Is the project necessary?
- Will the project increase the value of your property?
Borrowing money is not ideal. However, if taking out a loan will help you improve the security of your property, or increase its resale value, it is worth considering.
Bill Edwards is a freelance landscaper and writer who enjoys doing craft projects around the house. He and his children recently built a gazebo in the neighborhood near the community pool.
