How to Finance Portable Hot Tubs
Portable hot tubs can be financed by a number of sources. The first thing to do is find out all of the features you want and the purpose of the hot tub. You may want to use it for relaxation, exercise, or hydrotherapy and pain relief. The number of people you want to use the hot tube is important when it comes to the price of your hot tub. Choose the method of financing which is the most cost effective and saves you the most money. The price of a hot tub can range from $3,000 to $15,000 or more.
Instructions
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Credit Card
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Call your credit card company. When you get ready to purchase a portable hot tub you may consider using a credit card for financing. Sometimes you can receive a low promotional or introductory period for a specific period of time such as 6 to 18 months. If you have a zero promotional rate you pay no interest during this introductory period. When the promotional rate expires your balance will be subject to the standard rate for your credit card. Check with your credit card company to see what that is. The lower the rate the less money you pay in finance charges on the remaining balance.
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Get in touch with your mortgage lender and several other lenders. A home equity loan allows you to tap the equity in your home to make purchases. The equity in your home is determined by taking the value of your home and subtracting the balance. If your home is valued at $100,000 and your balance is $75,000 you have $25,000 of equity. Some lenders will only allow you to use a certain amount of that equity based on a loan-to-value, (LTV) equation. If your LTV is 80 percent this means you can only borrow $80,000 on a $100,000 home. Using this equation if your home is valued at $100,000 and your balance is $80,000 you will not be able to borrow any additional funds because you have exceeded your LTV percentage.
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Ask a representative at the hot tub facility what type of financing plans they have. Places that sell portable hot tubs will sometimes provide financing. You must meet their credit granting criteria in order for them to approve you for financing. If you have a judgment, bankruptcy, foreclosure or even some collection accounts on your credit file you may not qualify for their program. Each retail outlet will probably have their own criteria, so it is best to see what their qualifications are before you apply.
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Call your bank when you find out how much money you need for financing. Some banks will give you an unsecured loan for the purchase of your portable hot tub. The amount of money you receive will be limited because the bank is taking a risk because they don't have any type of collateral for the loan. You may not receive enough money to finance your entire purchase if you are looking to receive $10,000 to $15,000. A smaller amount is possible. If you are not looking to finance one of the higher priced models a bank loan could meet your purpose. Unsecured loans usually have higher rates of interest.
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Ask your banker if they will accept the hot tub as collateral. A bank may loan you the entire amount of money you need but they may require collateral. You may be required to pledge the hot tub as collateral. When a bank has collateral you have a chance of receiving more money. If you default on the loan, the bank will repossess your hot tub.
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Tips & Warnings
if you let the hot tub dealer finance your hot tub you could face a high interest rate. When you pay off the loan early you save money in finance charges.
If you use your home as collateral you could lose your home if you are unable to make the payments. The lender could foreclose.
