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Looking To Use The Equity in Your Home to Generate Returns?

March 25, 2024

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Getting ready to sell your home or simply looking to increase your home’s value? Cooler months can be the perfect time to conduct some research so that when the time comes, you feel confident that your home renovation will pay off. As you may imagine, not all home improvement projects tend to garner the same return on your investment, but Columbia Bank is here to help you make the possible, possible!

Why Invest in Your Home?

Keeping up with repairs and making smart improvements to your home can increase your home’s value, prevent unexpected damage, and make your home more competitive when it is time to sell.

The Best Return on Investment: Home Improvements

Although return on investments is not always guaranteed, statistics show that certain investments tend to yield larger returns than others.  According to the 2022 Remodeling Impact Report, a joint study from the National Association of Realtors® and the National Association of the Remodeling Industry, the below improvements are more likely to increase your home’s value.

  1. Installing or Refinishing Hardwood Floors: 147% ROI
    The best return on your investment may not be right in front of you. In fact, it may be right under your feet. You can improve your home’s livability and sense of enjoyment by upgrading worn-out surfaces. Refinishing or installing hardwood floors yielded the largest return on investment according to the National Association of Realtors’ Remodeling Impact Report.

  2. Energy Efficient Enhancements – Insulation Upgrade: 100% ROI
    Most homeowners don’t realize that insulation upgrades, window replacements, doors, new siding, or more efficient cooling and heating systems can boost home value. These are usually large undertakings that you can’t always see. However, these investments are typically investments you can feel and may be large enough to scare the next buyer away if not addressed.

    Not looking to move? You can reap the benefits of energy efficiency and enjoy potential savings on heat, electric bills, and more. Consider scheduling an assessment with a certified energy auditor or your utility company to determine where your home is wasting energy and which upgrades will save you the most money.

  3. Garage Door Replacement: 100% ROI
    Often overlooked, a new garage door or an update to your garage system is third on the list. Not only does the look of a new garage door increase the curb appeal of your home, but it also helps to protect the other valuable assets you store inside your garage.

  4. Roofing: 100% ROI
    Looming roof repairs may cause any homeowner stress and anxiety, but as fourth on the list, you may choose to reprioritize. Roof issues can cause major damage, cancellation of homeowners insurance policies, and more. Maintenance or upgrades can prove to be valuable in the long run.

  5.  Outdoor Improvements – Patio, Deck, New Landscaping: 86% ROI
    It’s true - first impressions matter! Improving your outdoor space can be a huge boost to your curb appeal and grab the attention of potential buyers viewing your listing. Improving landscaping by updating walkways, patios, shrubbery and even investing in a new deck, will make it that much easier for you or a potential buyer to enjoy all aspects of your property.


A misconception? Kitchen or Bathroom Remodels

Updating your kitchen and bathrooms have been known to boost value, but not as much as previously thought. A minor kitchen remodel recoups an average of 86% of its cost, versus 32% for a major upscale kitchen remodel with stone countertops, custom cabinets, and commercial-grade appliances, according to the Remodeling 2023 Cost vs. Value Report. For those seeking a return, a modest project may be a better alternative as opposed to a luxury overhaul.

Ready to invest in your home’s future value? Finance your home improvement projects now.

Home Improvement projects take time and money. Have one less thing to stress about by securing the financing you need, ahead of time. Avoid racking up large credit card bills and get prepared with a Home Equity loan that meets your specific needs.

About Our Home Equity Loans

Our Home Equity Loans offer you flexible ways to use your equity so that you can accomplish your goals.

Home Equity Line of Credit (HELOC)1 2  is a flexible borrowing option that lets you access funds as needed, up to a predetermined credit limit.

  • Draw funds as needed, and only pay interest on the funds you draw
  • Great option for ongoing expenses or home improvement projects with varying costs, allowing you to borrow and repay as needs arise
  • Take advantage of our limited time lower 12-month introductory rate1 2  


A Fixed Rate Home Equity Loan3 allows you to borrow a lump sum of money, secured by the equity in your home. Receive a competitive interest rate for the life of the loan.

  • Easier budgeting with predictable monthly payments
  • Enjoy peace of mind of by knowing exactly how much you need to repay monthly


Lets Recap

As a local community bank, we are proud to offer education and financing solutions to make the possible, possible. If you’re ready to get started, contact a local branch, or apply online.

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[1] Annual Percentage Rate (APR). Current 6.99% APR is a fixed rate for the first 12 complete billing cycles (introductory rate period) and variable for the remainder of the term. This introductory rate is not based on the index and margin used to make rate adjustments. 

[2] After the 12-month introductory rate period and for the remainder of the 10-year draw period, the variable APR is based on The Wall Street Journal prime rate as published on the 15th of the month minus a margin of .25%. The current prime rate as of the 15th of the month is 8.50%, resulting in a current variable APR of 8.25%. The rate takes effect on the first day of the billing cycle after the introductory rate period and may change monthly. After the ten-year draw period, the Annual Percentage Rate (APR) for the repayment period is a variable rate based on this same formula and may change annually. This rate takes effect on the first day of the first billing cycle of the repayment period. The Credit line has a minimum APR of 4.00% and a maximum APR of 15%. This Home Equity Line of Credit (HELOC) is available for 1-4 family, owner-occupied properties in New Jersey. Homeowners insurance is required, flood insurance may be required. Maximum combined LTV 75%.  For any loan $400,000 or greater, the borrower will be required to pay an appraisal fee of $525 to $675, depending on the number of units.  Higher fees may apply for complex or remote properties. A mortgage recording fee is due at closing. The fee ranges from $50 to $60 depending on the county where the secured property is located. Maximum credit line is $500,000 and minimum credit line is $25,000 with a minimum draw of $100.  During the 10-year draw period there is an annual fee of $75.  If this HELOC is closed and/or paid in full before 24 months, an Early Termination Fee of $500 will be charged. Minimum monthly payment during the draw period of 10 years, 1/240th of the outstanding principal balance or $40.00, whichever is greater plus finance charges and late charges. Minimum monthly payment during the maximum 20-year repayment period is the greater of $100.00 or an amount sufficient to amortize the loan. At the end of the draw period, you will no longer be able to obtain credit advances and must pay any outstanding balance over a maximum twenty (20) year term. Once this HELOC has been opened, the borrower(s) may not obtain this same line of credit type from us anytime within the next 24-month period unless the borrower reapplies and is approved for a credit limit that is higher than the original credit limit granted. All loans are subject to credit approval.  This offer does not apply to current Columbia Bank HELOC customers. 

[3] All loans are subject to credit approval.

Sources:

https://www.bankrate.com/homeownership/best-money-saving-diy-projects/#financing

https://www.cnbc.com/2023/03/27/remodeling-these-home-projects-offer-the-best-return-on-investment-.html

https://www.nar.realtor/sites/default/files/documents/2022-remodeling-impact-report-04-19-2022.pdf

https://www.nerdwallet.com/article/mortgages/how-to-increase-home-value?utm_campaign=ct_prod&utm_source=syndication&utm_medium=wire&utm_term=anne-stanleymarketwatch-com&utm_content=856466

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