Installing metal roof

[Hunter Emond]

We're in North Dakota due to my wife being stationed up in Minot (Bismarck was closest option for post). It's a windy area due to not a lot of trees and within the year I've owned the tri-plex I've have shingles fly off twice. I love the idea of metal roofing but due to being in the military we know we'll be moving. The quote for the roof is $41,000 and they do a hard credit check to approve you. Whether I keep the property or sell it, it will benefit the property in the long run. My question is if it would hurt my loan ability from the next lender we use if we have the roof payments still going that had to have financed through the contractor? 

[Ricardo R.]

Hey Hunter,

North Dakota wind will chew up shingles all day, so your thinking on metal roofing makes sense — it’s basically a 40–50 year solution. But here’s the key piece: how you finance it does affect your lending profile.

If you take out a contractor loan (often unsecured or high-interest), that monthly payment shows up on your credit report as another liability. When a future lender looks at your debt-to-income (DTI) ratio, that payment could reduce what you qualify for. It won't automatically kill your next loan, but it does count against you.

A couple of alternatives:

• Roll into a HELOC or home equity loan (if you’ve got equity). Lenders view that more cleanly than a retail contractor loan.

• Pay cash if you can swing it — then it's just a capital improvement that boosts the property value, no monthly hit to your DTI.

• If selling soon: a new metal roof is a great selling point. Buyers love “maintenance-free” upgrades, and it could put more money in your pocket at sale than an old roof with missing shingles.

So yes, financing the roof through the contractor will show up as debt and could trim your buying power on the next mortgage. If you know you’ll be applying for another loan in the near future, weigh whether the new roof return is worth temporarily lowering your lending flexibility; I hope this helps you a bit, I sent you a DM on BP and hope you can assist.