Best Options To Fund Your Home Renovation In Singapore

A house doesn’t become a home until you decorate it with your essence. Therefore, after getting your key to the place, you need to start renovating it just the way you want.

However, not all of us have plenty of money in our bank accounts. Thus, making our dream house seems like a wild dream. But don’t you worry; there are several options to fund your home renovation projects. And that’s what this article is all about.

We discuss the options you can try to renovate your home in Singapore. If you are eager to learn more, stay with us till the end.


How Much Does Home Renovation Cost In Singapore?

Before we talk about the financing options, let’s look at how much money you will need to decorate your house. Well, the average price of renovating a 4-room HDB flat is around S$50,000- S$60,000. And we are talking about a decent household, not a luxurious one.

Additionally, you need to keep a budget for your appliances too. Hence, you have to add at least S$20,000- S$30,000 on top of the renovation cost.

To makeup for the remaining renovation costs, couples in Singapore often take on a renovation loan to help.

Let’s take a look at some factors that determines your renovation budget.

  • Type of your home
  • The type of renovation work you require
  • Condition of your house
  • Materials you want to use for decorating

The Type Of Renovation Work And Their Cost

The type and condition of your house play some role in controlling the renovation budget, that’s true. But the main thing that determines the actual budget is the type of renovation work you want to perform in your house.

If you want to make a humble room with a minimalistic design, it won’t cost you much. But if you want a place full of shenanigans, you will need dollars for that! Now, let us give you an idea of how much it may cost you if you go for a decent decoration.

Renovation TaskWhat Does It Involve?Estimated Cost
Ceiling & Building PartitionsFalse ceiling, curtain pelmets, false walls, and dividing the space.S$5000
Painting2-3 coats of painting for your walls and ceiling, including primer and sealer.S$2000
Hacking DemolitionRebuilding, hacking, and strengthening walls, including touch-ups.S$6000
PlumbingAll the waterworks around your household, including concealing and extension of water pipes.S$1000
CarpentryAll the features you want to add to your house, including kitchen islands, cupboard, storage, bed frames, tables, TV consoles, etc.S$24,000
MasonryFlooring, tiling, and waterproofing the whole thing.S$10,000
ElectricalElectrical features such as wiring, power points, wire extensions.S$4000
Cleaning and touch upAfter remodeling your place, cleaning up the dirt give some finishing touches in some portions.S$500
FurnitureBed, sofa, chairs, table, and so on.S$10,000
AppliancesOven, fridge, AC, heater, washing machine, etc.S$15,000.


Options For Funding Your Home Renovation: All You Need To Know

Now, it is time to enlighten you about the financing options for decorating your house. From renovation loans to fast cash loans, we’ll tell you about everything so you can make the correct decision with confidence.

When it comes to funding your home renovation project, you will have four solid options.

1. Renovation Loan

2. Personal Loan

3. Credit Card

4. Store Loans

Renovation Loans

A renovation loan is the most popular option for remodeling your house. This loan is specifically granted to help with decorating; hence, you cannot spend this money on whatever you want.

Horison Credit has approved more than 5,000 renovation loans in the past year, helping couples build their dream home. Read our customers’ reviews. Our hard work has earned us a high 4.9 stars!

The loan repayment period is flexible; you can choose between 2-5 years. And there is also a fixed amount of loan; you can only get up to six times your annual salary or S$30,000; depending on which amount is lower.

Here are the types of renovation loans.

  • Monthly Rate: As you keep repaying your loans, you’ll have to pay less interest over time.
  • Flat Rate: You will have to pay the interest based on your total loan amount.

In addition, renovation loans can only be used for the following tasks.

  • Painting and redecorating
  • Built-in cabinets
  • Structural modifications
  • Electrical works
  • Flooring and tiling
  • Bathroom fittings

Well, you cannot use this money for:

  • Furnishing
  • Air conditioning
  • Electrical appliances

Personal Loan

If you need more money to buy some appliances or furnish your home and renovate, you can go for personal loans. Unlike the renovation loan, it doesn’t come with boundaries; you can spend your money wherever you want.

However, the interest rate of personal loans is higher than renovation loans. But you will get a larger amount of money depending on your credit history and income.

Apply for a large personal loan here.

Credit Card

You can also use your credit card for purchasing furniture and appliances. Furthermore, the card can be used for paying the renovation bills too.

But we don’t recommend you choose this method because credit card interest rates are rocket high, up to 25% per annum. Therefore, if you can avoid paying bills, you will have a better experience.

Store Loans

The retail stores also offer loans so you can buy products from them. Unlike a bank or personal loan, you don’t have to show any proof of income, and the loan will be granted pretty quickly.

Though it sounds like a lucrative deal, it actually isn’t. As the interest rate is super high, this debt can become a nightmare for you.


What Are The Eligibility Requirements For Renovation Loans?

Renovation loans require more paperwork than personal bank loans. Moreover, you cannot just go to any bank and apply for this finding. Financial institutes such as DBS, POSB, OCBC offer loans for home renovation projects.

Here is the list of criteria you need to meet to get a renovation loan.

  • You must be a Singaporean or a Permanent Resident of Singapore
  • Your age has to be between 21-55 years
  • You have to earn at least S$24,000 per annum
  • If you are filing a joint application, the other applicant must be employed and should be the main candidate’s children, parent, sibling, or spouse
  • Main or joint candidate, one of them has to be the owner of the property that will be renovated
  • Need to have a good credit score

In addition, you will need paperwork such as:

  • Your renovation contract or quotation from the contractor
  • Proof of property ownership
  • Your income documents

If you were rejected by banks, or that you cannot get your desired renovation loan amount, do not worry! Horison Credit is able to personalise home renovation loans with larger amounts for you!


Renovation Loan vs. Personal Loan: Which One Is Better?

As you can see, renovation and personal loans are the best options you have. Now, it is time to decide which one will be more beneficial.

Let’s take a quick look at their features for a better judgment.

Renovation LoanPersonal Loan
Lower interest rate; typically ranges between 2%-3%Higher interest rates; can vary from 3.5-11%.
Your expenditure will be fixedYou can use the money as you prefer
The capital amount will be low.Offers higher capital amount
Lower processing feesHigher processing fees

As you can see, both systems come with their perks and cons; the decision totally depends on the borrower. If you only need money for renovation works, you can go for this specific loan.

On the other hand, if you have bigger plans but less money, you can choose personal loans. This way, you can complete your remodeling project and invest some money in a business opportunity, whatever you want. But you have to pay a higher interest rate, so keep that in mind.

All the details are in front of you; hence, you need to pick one that seems more flexible for you. The ultimate decision is totally up to you!


How To Apply For A Renovation Loan?

If you plan to take a renovation loan, this is how you do it.

Step One – Get a Quote from Your Contractor

When you meet all the eligibility requirements for a renovation loan, you must search for contractors or interior designers. And then, talk to them about your remodeling project and ask for a quotation from them.

For this thing, you can visit different vendors and contractors for a better experience.

Step Two – Prepare Your Documents

Now that you have got the quotation, it is time to prepare the paperwork. You will need:

  • Invoice
  • Proof of homeownership
  • Income documents
  • NRIC
  • Latest IRAS notice of assessment

Final Step – Apply for Loan

When you are done arranging everything, please submit your application and receive a letter once it gets approved. However, the loan amount will be issued to your contractor; you won’t be able to cash out the money.


The Bottom Line

So, here are all the options to fund your home renovation in Singapore. Though there are plenty of methods, you should choose between a personal loan and a renovation loan for an optimal experience.

Getting a home renovation quote is free and easy as well. Horison Credit offers free quotes for all!

While renovating your house, always remember that you can go for an extravagant décor; but you will also have to pay the interest rate. Therefore, try to remain within your means, which will help you to repay your debt effortlessly.


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