Dock construction is a large and important addition to your property that will increase its resale value. The question for many will be how to best finance your dock construction.
Here at Decks & Docks Lumber Company, a premier marine construction supplier in the Southeastern United States, we have some suggestions on how to best finance your deck construction that will go easier on your wallet than typical credit card fees.
Why Most Should Skip the Plastic
If you are using your credit card as a long-term plan in order to pay for your deck, consider first your credit card’s current interest rates. As of November of 2019, The Balance reported that credit card rates have gone up to around 21 percent. That is far higher than they were in the past. At 21 percent interest, many homeowners will be forced to primarily pay the interest and will find it tough to pay the principal. Not being able to pay down the principle will lead to a state of perpetual indebtedness servicing high-interest payments.
When people get stuck in credit card debt, they can get behind in payments, which will harm their ability to get credit for absolute necessities, like a home or a car, at fair interest rates.
When is it Safe to Use Credit Cards to Pay for Your Dock?
If you know you can pay down the balance in one to three months, you will not incur enough interest charges to make the hit financially ruinous if you use your credit card to pay for your materials.
Lower-Interest Options to Finance Your Boat Dock
Personal Loans
There are providers that offer personal loans at far lower interest rates than your credit cards. The terms can be up to five years to pay off the loan.
Construction Loans
If your dock is considered by your state law to be real, rather than personal property, you may qualify for a construction loan. According to Forbes Magazine, a construction loan lasts as long as the construction is occurring. The bank supervises the payout of the loan proceeds to the contractor in draws. At the end of the construction, you would need to either pay off the loan or convert it to another loan type. The good thing about this type of loan is that the bank is supervising construction, which will shield you from unscrupulous contractors.
Home Equity Line of Credit
The interest rates on a home equity line of credit are quite low compared to credit card interest rates. The problem with this type of loan is that, if you default, the bank can take your home.
Here at Decks & Docks Lumber Company, we have been serving the Southeastern states with 15 locations that stretch from Florida north to Virginia. We have two decades of experience in the field and offer the top, award-winning brands of marine lumber and hardware supplies. Call us for all of your dock construction projects. We are here to serve you