Financing Options

Home Improvement Financing Options

The type of financing you'll want to choose for your project has a lot to do with the type and cost of the renovations you are doing. Here are the options that may be available to you at RBC Royal Bank, based on the type of project you are planning:

Financing an Extensive Home Improvement Project

Using your home equity is one of the most cost-effective ways to finance a large, extensive home improvement project. That's because home equity loans and lines of credit often offer a lower interest rate as compared to other types of loans.

We offer the following solutions:

  • RBC Homeline Plan®

    Manage your mortgage and home improvement line of credit under one plan. You could qualify for this flexible financing option with a minimum of 20% equity in your home.

  • Mortgage Add-On

    Access additional funds by simply adding them on to your existing RBC Royal Bank mortgage, based on the current appraised value of your home.

  • Royal Credit Line®

    Consider a line of credit if your renovations will be done over time and you don't need all the money at once—or if you plan to reuse your credit after paying it off.

  • Mortgage Refinancing

    Refinance your existing mortgage and have up to 30 years to repay.

Making sure you have the right type of financing in place for a major renovation is important, so be sure to talk to an RBC Royal Bank credit specialist, who can recommend the best solution for your needs.

Financing a Mid-size to Large Home Improvement Project

If you are planning a mid-size to large home improvement project that will cost over $5,000, a line of credit or personal loan could meet your needs:

  • Royal Credit Line®

    Consider a line of credit if your renovations will be done over time and you don't need all the money at once—or if you plan to reuse your credit after paying it off.

  • RBC Royal Bank Personal Loan

    A personal loan could be ideal if you need the funds all at once and want a structured repayment plan.

Not sure which option is right for you? Talk to an RBC Royal Bank credit specialist, who can recommend the best financing option for your project.

Financing a Small Home Improvement Project

If your project is going to cost less than $5,000, you may want to consider using cash and/or a credit card to finance your project.

We offer a wide range of credit cards, including cash back, rewards, low interest rate and no annual fee cards.

Financing a Green Home Improvement Project

Whether you're adding a solar thermal system or switching to energy-efficient appliances, we have the financing solutions to make your green home renovations happen. You could even save money on a home energy audit or your loan.

  • RBC Energy Saver Loan(1)

    Receive 1% off the loan interest rate or a $100 rebate on a home energy audit on a fixed rate instalment loan over $5,000 when you purchase eligible products or services.

  • RBC Energy Saver Mortgage(2)

    Receive a $300 rebate on a home energy audit with this unique mortgage.

  • RBC Homeline Plan®

    Manage your mortgage and home improvement line of credit under one plan. You could qualify for this flexible financing option with a minimum of 20% equity in your home.

Home Improvement Tips and Advice

If you're planning a home improvement project, check out these tips first:

Before you start a home renovation project, it's a good idea to consider the following:

  • How long will you be in your home?

    If you plan to stay for several years, your needs and desires for your living space usually become more important than adding resale value.

    On the other hand, if your main aim is to boost your home's resale value, you'll probably want to perform the work that offers the best potential payback. You don't want to put money into renovations that buyers won't pay for.

    Also check out the amenities in other houses in your neighbourhood. It's good to bring your home up to par with others nearby—but you don't want your renovations to make your home the most expensive on the street. Ask a real estate agent for help with the decision-making process.

  • How will you pay for the renovations?

    If you plan to stay for several years, your needs and desires for your living space usually become more important than adding resale value.

    Ideally, you would pay in cash, but before you liquidate assets, do the math: depending on the type of investments you hold, cashing out may not be in your best interests. You may find that the costs of financing are lower.

Your personal style can transform your house or condo into your true “home.” But which changes or renovations make the most sense when it comes to building value in your home?

Below are the top 10 home improvement projects that result in a higher average payback at the time of sale:

  1. Bathroom (75-100%)
  2. Kitchen (75-100%)
  3. Interior Painting (50-100%)
  4. Exterior Painting (50-100%)
  5. Roof Shingle Replacement (50-80%)
  6. Furnace/Heating System (50-80%)
  7. Basement Renovation (50-75%)
  8. Recreation Room Addition (50-75%)
  9. Installing a Fireplace (50-75%)
  10. Flooring (50-75%)

A home energy audit is a report generated by a licensed professional who is specially trained to examine your home's major heating and cooling systems. He or she will make recommendations to help you improve your home's energy efficiency and lower your energy costs. You can then decide what you want to do and how much you want to spend.

At RBC Royal Bank, you could save money on your home energy audit through one of these financing options:

Plus, when you complete a home energy audit, you may be able to receive additional government rebates and incentives:

  • Complete some or all of the suggested renovations and improvements within 18 months and have your home auditor return to verify the work. Your auditor will submit an application on your behalf to both the federal and provincial governments.
  • Ask your municipal government if similar incentives and rebates are available in your community.
For additional information:

For more information about the energy audit process, benefits and scheduling an appointment with a qualified energy advisor, visit My Energy Audit

From quick and easy things you can do today to projects that require the help of a professional, there are many ways to make your home more eco-friendly. The list below will give you some ideas on how to improve your home's energy efficiency and save you money.

Tier 1: Estimated Annual Savings = $20–50
  • Install low-flow faucets and shower heads to decrease water usage and reduce the cost of heating water by up to 50%
  • Choose energy-efficient appliances
  • Install outdoor motion detector switches
  • Replace air conditioner and furnace filters regularly
Tier 2: Estimated Annual Savings = $50–100
  • Use power bars to switch off your electronics
  • Switch to compact fluorescent light bulbs
  • Install a programmable thermostat
Tier 3: Estimated Annual Savings = $100–250
  • Caulk all windows and make sure your home is properly insulated
  • Use ceiling fans year round to help circulate warm and cool air evenly around a room(3)
  • Replace an old refrigerator with an energy-efficient one (this can save enough electricity to light the average home for more than four and a half months)
Tier 4: Estimated Annual Savings = $250+
  • Replace your existing windows and doors with energy-efficient designs that will reduce your home's energy use (both heating and cooling)
  • Replace your existing furnace with a high efficiency furnace. They have increased safety (for newer airtight homes), longevity and there is no need for a chimney.

For more information on renovating for energy savings, visit the Canada Mortgage and Housing Corporation

Sources:

Ontario Power Authority: the phrase "Ontario Power Authority" is an official mark owned by the Ontario Power Authority.

Canada Mortgage Housing Corporation (CMHC): About your house series. Keeping the Heat in: NRCan Publication

Canada Mortgage Housing Corporation (CMHC): About your house series. Replacing your Furnace: NRCan Publication

David Suzuki.org

In addition to the loans, lines of credit and other financing options offered by RBC Royal Bank, you may be able to take advantage of additional outside incentives, rebates, subsidies or tax credits for your home improvement project.

To learn whether your home improvement project is eligible for subsidies or tax credits provided by provincial and federal government programs, check with your municipal office or look in the Blue Pages of your phone book, under "information on Federal Programs and Services." As well, Canada Mortgage and Housing Corporation (CMHC) offers programs for low-income Canadians, people with disabilities and Aboriginal Canadians.

For more information, visit the Canada Mortgage and Housing Corporation

Make Your Home Improvement Dreams a Reality

Our credit specialists will help you select the credit solution that is right for you.

Call to Talk to a Credit Specialist

Visit Your Local RBC Branch

Personal lending products and residential mortgages are offered by Royal Bank of Canada and are subject to its standard lending criteria.

According to the Appraisal Institute of Canada, in its national 2004 Renovations and Home Value Survey.

Subject to Royal Bank of Canada standard lending criteria. Must be a fixed rate installment loan of at least $5,000. Audit can be done 90 days before loan advance date or 90 days after loan advance date and can be submitted 120 days after loan advance date. Offer begins February 15, 2009 and is available until further notice. Amount of rebate will be the actual invoiced amount of the home energy audit, up to a maximum of $100. Offer may be withdrawn at any time. Cannot be combined with any other offer.

Available on residential mortgages, both purchases and re-finances, including the RBC Homeline Plan with a minimum term of three years fixed closed or five–year variable closed. This offer is available until further notice. Offer may be withdrawn at any time. The minimum mortgage amount must be $25,000. Cannot be combined with any other offer. Audit must be completed within 90 days of mortgage advance and submitted within 120 days of mortgage advance for refund. Amount of rebate will be the actual invoiced amount of the home energy audit, up to a maximum amount of $300.

Tip Courtesy of www.treehugger.com, Environment Canada's National Office of Pollution Prevention: www.ec.gc.ca/pollution>www.ec.gc.ca/pollution

The principal and interest portion of any skipped payment will remain outstanding until the end of the term of your loan at which time the skipped payment must be repaid. Interest will continue to accrue upon the total amount of the skipped payment until such time that the skipped payment is repaid in full. You may repay the skipped payment at any time.