Plumbing problems can strike without warning, and when they do, they tend to be costly. That’s why customer financing is important to the success of any plumbing business.
There are several plumbing finance methods that homeowners can use to fund their repairs and upgrades. We’ll review the most common ones: personal loans, home equity lines of credit, and credit cards.
Home Equity Loans
If you’re seeking plumbing financing for a major renovation or upgrade, home equity loans are a good option. These secured second mortgages are available from a variety of lenders, each with their own terms, amounts offered, and qualification requirements.
However, a home equity loan requires you to put up your home as collateral, so if you’re unable to make repayments, the lender can foreclose on your property and recoup costs. Therefore, it’s best used for more long-term goals or when you have a clear plan of what you want to accomplish with the loan.
Personal loans, on the other hand, are unsecured and work more like a credit card. Navy Federal offers a personal loan with competitive rates and no prepayment penalties, which makes it a good option for smaller repairs or upgrades to your plumbing. You can apply online today.
Lines of Credit
Homeowners have a number of different finance and loan options to cover the cost of plumbing work on their homes. These include personal home improvement loans, credit cards, and lines of credit. Providing homeowners with the option to finance their plumbing projects and repairs can help them avoid feeling the financial impact of large service orders. This can increase the likelihood of them partnering with your company for their next plumbing project.
Lines of credit, which work similarly to a credit card and only charge interest on what has been used, are a great option for homeowners who may not have enough equity in their home or don’t want to risk losing their property. These can also be a good solution for large projects that exceed the limits of a homeowner’s credit card.
Customer financing programs are a proven way to boost your service business’ sales and help homeowners pay for plumbing work on their homes. When paired with the right plumbing business software solution like ServiceTitan, they can be easily implemented for your company and provide a seamless experience for your customers.
Personal Loans
Whether you need an emergency water heater repair, a new sewer line installation or a major bathroom remodel, plumbing projects are often expensive. To finance your plumbing work, you can use a home equity loan or a line of credit, which both require collateral and carry the risk of foreclosure if you fail to make payments. If you don’t want to put your home on the line, a personal loan is an option with lower interest rates but stringent qualifications.
A lender like Upgrade, which offers loans to borrowers with less-than-perfect credit scores, or LightStream, which considers more than just your credit score when determining eligibility, may offer the best personal loans for plumbing. Alternatively, you can also look for financing from a plumbing contractor. For example, Hearth, a network of home contractors, and Roto-Rooter, which is famous for its drain cleaning services, offer credit card and financing options.
Credit Cards
The good news is, there are several financing options available to help you pay for plumbing work. Here are some of the most common:
Credit cards can be a great option for small emergency repairs, since they usually offer 0% introductory rates and don’t accrue interest. However, if you carry a balance past the introductory period, high-interest rates will kick in, and you could end up with mounds of debt.
Many plumbers partner with financial services companies to offer customer financing programs. These programs can include personal home improvement loans, home equity lines of credit, and unsecured personal loans. These programs are based on a homeowner’s total household income and credit history, and can have different terms, amounts offered, and interest rates.
