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Consumer Help & Advice

What is Stage Funding, and How Does it Impact My Home Improvement Project?

As a homeowner seeking to embark on a home improvement project, you will be doing your research about contractors. The funding options they offer for the labor that needs to be done is important. Stage funding may come up often as you search through possible contractors to complete your work. This will lead you to ask, “What is stage funding, and how does it impact my home improvement project?” 

This question is important to answer. Stage funding will greatly impact the progress and smoothness of the construction process. As its name suggests, the funds for your home improvement project will release in stages. This type of financing is not ideal for many reasons. 

Complex and Cumbersome Check-ins

Companies that offer stage funding make the task at hand — improving a beloved space in your home — very cumbersome. Instead of releasing money at one time to you or even to the contractor, each step of construction must be completed before payment is rendered for just that phase of work. As each stage is slowly completed, this process is repeated multiple times until the project’s completion.

The contractors are required to complete one phase of a build and then wait for the funding company to verify the completed work before continuing. They might send someone to the site to check the work or ask for pictures. They could also specify that a certificate of completion is necessary. 

Some financial institutions also require the homeowner to verify the qualifications of their chosen contractor before allowing them to even get the loan process started. The stage funding option is complex and cumbersome. Repeated check-ins make things very complicated for the homeowner and contractor alike. 

Discouraging and Disheartening Delays

Inevitable delays are part of a home improvement project. Weather is a big factor that is uncontrollable but often affects progress. The workloads and employee availability of your contractor’s team can also delay the improvement you’re dying to bring to fruition.

Add to these typical delays the disheartening fact that each phase will also cause a halt in the process throughout the construction. This is very discouraging for homeowners who are just eager to have their remodel complete.

The contractor’s schedule has to coordinate with that of the funding entity’s to make sure that the requisite inspections are accomplished. In a perfect world, your project would be the only one that a contractor is dealing with. We all know that is not the case. Multiple projects in progress simultaneously can just add more delays for a stage funding loan project.

Carefully Chosen Contractors

Now that you know the answer to “What is stage funding, and how does it impact my home improvement project?,”  you can carefully choose a contractor. Contractors that partner with HFS Financial know that stage funding is not an option homeowners want. As customers search for a contractor’s options for financing a new swimming pool loan, home improvement, or remodeling project, they do not want the funding to come in stages.

HFS Financial is one of the only companies that gets the funds directly to you, the homeowner, BEFORE the project begins! No matter the size of your home improvement project, we have just the right loan option for you. Call us today at 1-800-254-9560, or complete this 60-second inquiry to get your financing search started. “You Dream It, We Finance It.”

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