Wednesday, 30th September 2020 | Personal Loan
Home improvement: What you need to know if you’re thinking about getting a home renovation loan
Thinking of renovating your home? Here's what you need to know about renovation loans, HELOCs and borrowing to renovate.
There are all sorts of compelling reasons to renovate your home. Perhaps you’re making room for a new addition to your family or seeing someone off to college. Kitchens and bathrooms especially appreciate regular updates. Or maybe you’re just protecting your investment. Whatever your reason for considering a renovation, you’ll have to work with a budget to get the job done. For most, this means looking into a home renovation loan. If you have questions about how to take out a loan for your home renovations—or even if you should—you’ve come to the right place.
What is a home renovation loan?
As the name suggests, a home renovation loan is money borrowed to do home renovations. It’s a personal loan, and at most lenders, iCapital included, it’s secured against the equity you have in your home. Another term for this is a home equity loan.
Home equity loan vs mortgage refinancing vs a HELOC
Some borrowers find money for renovations by refinancing their mortgage. This method also uses the equity in your home as collateral but in the case of refinancing, the idea is to pay off your mortgage and take out a new mortgage—ideally at a lower rate. This option isn’t well-suited to those who intend to sell in the shorter term.
Like mortgage refinancing, home equity loans give you access to a lump sum of money, and they use your home as collateral so they tend to offer a lower interest rate than unsecured personal loans.
A third borrowing option is a home equity line of credit (HELOC). Imagine a HELOC like a credit card with your equity representing your limit where you can borrow small amounts as you need them. HELOCs are offered by all of the major banks and are typically based on a variable interest rate.
Ultimately, the product you choose will depend on your circumstances but all of these loans can be used towards a home renovation.
Is now really a good time for renovations?
The COVID-19 pandemic has thrown a lot into question for a lot of Canadians. Some have had their hours reduced or lost jobs altogether. Others have seen their investments tank. If you’re struggling with the idea of borrowing money for a home renovation you’re not alone. It’s wise to go into a borrowing agreement informed and now is a time of great uncertainty. That said, there are valuable opportunities for those in the position to seize them.
Individual Canadians are not the only ones living with financial uncertainty, and that means lenders are offering notably low rates. A personal loan for homeowners at iCapital can be financed for as low at 9.99%.
Other factors to consider are that you and your family might have more time to dedicate to a renovation and even be able to funnel some funds earmarked for something else (like travel for example) into the project. No matter what else is going on, it’s always a good idea to protect your investment by keeping your home in good shape so now might be an ideal time to take care of maintenance and updates.
Is a home renovation a good investment?
Your home is likely one of your biggest investments so it makes sense to care for it. That said, some renovations promise a higher potential return than others. If you’re thinking about your renovation as an investment on your resale value, skip the accessories and think about the basics. A new roof or furnace will go further than countertops or interior paint—particularly if you don’t intend to move for a while during which time styles may change. That said, deep renovations on kitchens and bathrooms that include up-to-date appliances can provide the “wow” factor to command a higher asking price.
What you need to know before applying
Before you apply for a home improvement loan you should have been able to prove your financial solvency and ability to pay back the loan. Generally, you’ll need to show a regular income, a bank account, and a permanent address. A good credit score is important as it shows lenders that you have a record of repaying your loans. Also, a better credit score will sometimes get you access to a lower interest rate.
In addition to the loan amount, you will also need to negotiate the amortization period—that is, the amount of time you have to repay the loan—and the terms. At iCapital, the amortization periods can range between 9-60 months, and repayment is done through a regular, scheduled automatic debit from your account.
Whether you’re considering renovations as an investment or to simply increase your own enjoyment of your space, there are compelling reasons to make the leap now. Favourable interest rates and a bit of free time don’t generally come along simultaneously. With the right preparation and plan, you can go after a home renovation loan with confidence.
4 winning strategies to make your loyalty program a success
We’ve all heard about job loss, missed school, and the overtaxed health care system, but a surprising consequence of COVID-19 comes from the business sector. Pre-pandemic customer loyalty is all but a faint memory. According to a McKinsey & Company report, consumers around the world have changed their shopping practices during the crisis, including trying out new brands. The result? Changes in brand preference. The communications firm Ketchum found that nearly half (45%) of consumers surveyed changed their preference for at least one brand, and a majority (62%) anticipated that these shifts would be permanent.
All this upheaval creates yet another challenge for Canadian small businesses, but planning—and a solid loyalty program—will encourage more devotion from your customers. If you’re looking for ways to incentivize your customers, you’ve come to the right place. Read on for four winning strategies to encourage customer loyalty.
What is a loyalty program?
If you’ve ever used a buy-ten-get-one-free card, a coupon, or referral link, you’ve taken part in a loyalty program. Simply put, these are incentives designed to attract and keep customers by offering something back in return for their patronage. Implemented properly, loyalty programs can not only attract new and repeat customers but also foster positive associations with your brand and even your staff.
Like anything else in business, there are best practices for loyalty programs. These four strategies will help you design a winner.
Loyalty program best practices
1. Make it simple to use
Your loyalty program will not work if it’s too complicated. Make sign-up easy (or non-existent). Avoid multi-step ideas that may cause customers to abandon the program. Be flexible to accommodate real-life situations. For example, if a customer has forgotten their loyalty card, issue them another and allow them to combine stamps for redemption. The simpler your loyalty program is to use, the better.
2. Make it easy to redeem
Customers use loyalty programs for the rewards, so make sure they can easily redeem. Don’t make them jump through hoops. If they earn it, they deserve it. Simplify the process by asking for customer information upon sign-up, not when they want to redeem. Nothing turns a customer off like feeling they’ve been duped so make sure your redemption process has no nasty surprises.
3. Have few to no restrictions
Don’t complicate your rewards program with too many restrictions. For example, if you have a points program, don’t limit what they can be used to redeem. This kind of “small print” will only erode the goodwill you’re trying to foster.
4. Keep time to reward short
Your customers want to realize the benefits of your program as quickly as possible. Your program will never get off the ground if it takes too long for customers to be able to redeem. Make it easy for your loyal customers to start earning points right away and be reasonable about the amount a customer is required to spend or the number of times they have to visit before they have accumulated enough points for a reward.
A customer loyalty program can be the right strategy to bring customers back to your brand—and to attract new ones. These four simple best practices will guide you toward a program that works for you and your target market.
Get noticed: Key elements of a great business sign
Small businesses need to take advantage of every chance they have to get their message across, and their storefront signage is an often-overlooked opportunity. Displaying your business name is just one job for your business sign. It can also communicate your brand identity, advertise specials or promotions, and create an inviting entryway to your storefront. But creating the right sign isn’t as simple as you might think. In this article, we sat down with Todd Hovey, owner of Pure Image Signs in British Columbia, to find out what, exactly, makes a great business sign.
When you’re planning out your business sign, one of the first things to consider is how big it will be. Too small, and you risk going unnoticed but a sign that’s too large can appear clownish. “Your signage company will follow distance charts to ensure the sizing is good,” Hovey says. “Of course, you’ll have to follow your city’s guidelines or restrictions for the sizing.” As a general rule, your sign should be large enough to for your customers to read easily, even from a distance.
Choosing your materials may seem like a design decision, and to some extent it is, but it’s also (and perhaps more importantly) a choice that will dictate the longevity of your sign. “You don’t want it to start to deteriorate and detract from how good your business looks,” Hovey notes. “This is worth the investment.” Your choice will depend to some degree on your storefront. You may be limited to an application on the front window, or maybe you have an awning or banners. If you have a flat façade, you have many options. “If you want to add dimension to your sign, try a three-dimensional sign,” Hovey suggests. “It stands out so much more than something flat.” Another 3D option is a blade sign that hangs perpendicular to the outside wall. “Most signage is painted or made with vinyl or another material that will deteriorate over time,” Hovey says. “A good quality sign should last over a decade or longer and interior signage can last forever.”
If your storefront is not in a well-lit area, you’re liable to miss the mark with your customers after dark. If you are open past dark, the increased business a lit sign may bring in may mean it pays for itself in no time. It may surprise you to hear that adding light to your signage can also catch your customers’ notice in the daytime. Lighted signs require an investment upfront but the LED technology they use is energy efficient and the design choices are nearly limitless. Look into illuminated lightboxes, externally lit sign boxes, halo-lit letters, and front or back (or both) lit channel letters.
Your sign is the first thing your customers see so its design should be impeccable. Make sure that your design elements like colours, logo, tagline, and business name are exact and match the rest of your business collateral. Pay attention to the spacing and lettering, bearing in mind that the eye can detect even slightly imperfect kerning (that’s the space between each character). And ensure that your sign is legible, even from far away.
By choosing the right style, size, materials, and design, can you improve the appearance of your business and attract new customers? According to our sources, all signs point to yes.
4 ways to engage customers using video on Instagram
Social media can seem like a far cry from the actual business of, well, running your business but the fact is, Canadian consumers are on social media, and they’re hoping you are, too. Video content is some of the fastest-growing and most engaging out there so this is an excellent place to start—even if you’re camera shy. Video is all about showing instead of telling so today we’re going to take a look at four Canadian businesses that are doing a great job on social media to give you some ideas of how you can use video on your Instagram profile. Read on to get your creative juices flowing.
"DIY" stories | Go Clean Company, Calgary @gocleanco
At the beginning of the COVID-19 pandemic, Calgary’s Go Clean Company was just another cleaning company with a moderate following on social media. Now they have 1.8 million followers. What’s really remarkable is that their strategy is as simple as vinegar and water. Go Clean Company engages its followers with show and tell. Log on to their Instagram on any given day and you’ll see videos sharing recipes for cleaners and offering how-tos and hacks, both in their stories and feed. Their content is down-to-earth, funny, actionable (did you know you can clean microfibre furniture with Windex?), and relatable—and they even offer a Cleaning Army Handbook.
Takeaway: Think about what your company can share that people would find helpful and shoot a quick video on your phone.
Strategy: Educate people with DIY videos
Live video | Erietta Boutique, Toronto @eriettaboutique
With spring upon them, Toronto’s Erietta Boutique found themselves in a familiar position for retailers—they had leftover merchandise from the previous season because their storefront had been closed for months. Rather than hang a sale sign in the window, they tried something they’d never done before: a weekly live sale on Instagram. It took some time to figure out the mechanics of it (the owner enlisted her son to operate the camera and track the sales as they happened), plus she admitted on camera how nervous she felt but it has engaged dozens of customers week after week.
Prior to COVID, the boutique had a very minimal website but they took the time to make some upgrades and put nearly their entire inventory online. Video posts are a simple and fun way to show off sale items and let followers make purchases, and the live aspect increases engagement and excitement.
Takeaway: Consider which elements of your business could inspire excitement if they were held live. And don’t worry about being nervous or trying something new—your customers won’t mind.
Strategy: Sell using live events
Reels | The Nest, Fredericton @thenestyogafreddy
In addition to the grid-style feed and IGTV posts, Instagram offers “Reels”. These are 15-second videos similar to what you can create on TikTok. Unlike Stories, Reels stay on your profile in the Reels tab. Plus, they can be seen by people who don’t follow you, too. The Nest has been experimenting with Reels to engage customers and potential customers alike. They’ve blended sales-y content with fun in clips like “What to get your girlfriend for Christmas”.
Takeaway: Be experimental with your content and see what works. Don’t be afraid to share a peek “behind the scenes”.
Strategy: Engage people with Reels
Feed videos | MEC, Canada @mec
Just because MEC is an enormous brand doesn’t mean smaller enterprises have nothing to learn from them. Their how-to videos rival what you’d find on YouTube and avoid the bloat of ads to boot. Under their IGTV tab, they’ve got videos like “How to wax your skis”, “how to choose climbing shoes” and “How to layer clothes”, among other types of videos. Not video, but notable nonetheless is their post on the “Guides” tab. They’ve compiled existing feed posts to create a “staffer’ gift guide”. What a great way to re-use past posts. These Guides can be shared on Stories, too.
Takeaway: Make your social media useful to your customers by sharing your expertise
Strategy: Be an expert with “How to” videos
Social media—especially video—can seem like a high bar to clear but luckily for Canadian small businesses, it’s easier than ever to get air. Instagram offers a few ways to engage people through videos. Experiment with these simple yet effective Instagram tools and see what a difference it makes to your business.
Protecting your online presence from cybercrime
Contrary to popular belief, cybersecurity is not just a problem for big enterprises. In 2019, one in five SMBs was the subject of an attack and 37% of those estimated their damage to be more than $100,000, according to an Insurance Bureau of Canada poll about cybercrime and small- or medium-sized businesses. Worse yet, cybercrime is on the rise in Canada, according to the Canadian Centre for Cyber Security’s 2020 National Cyber Threat Assessment Report and the technology is becoming more sophisticated. If you’re a small- or medium-sized business, you’re not immune from attacks but there are things you can do to bolster your security. Read on to learn more about cybercrime and how you can protect your business.
Why SMBs should be concerned about cybercrime
When it comes to cybercrime, the media tends to report on large-scale hacks and major security breaches but Canada’s small- and medium-sized businesses are at as much risk—and may not be as prepared. In the early days of the internet, hackers were mostly interested in mega-corporations and government--organizations that could yield massive pay-offs when breached. These days, though, there’s money to be made from smaller businesses. If you operate un- or inadequately protected, hackers could get into your databases and they’re chock full of identities waiting to be stolen, contacts ready to be exploited, or cash for the taking. Even simpler, hackers might gain entry to your website and hold it for ransom, as happened to a Canadian insurance company in 2019. If you’re breached, the financial cost alone can be crippling, never mind the damage done to your reputation and ability to do business.
Cybersecurity basics: What you can do right now to increase security
Every business, no matter how small, should have security measures in place to protect against cybercrime. Despite this, as many as 40% of SMBs are completely unprotected. One reason for this is the misconception that cybersecurity is highly technical, complicated, and costly, but the Canadian Centre for Cyber Security asserts that this is just not true. In fact, they provide a “baseline” document outlining 13 basic measures SMBs can undertake to bring their cybersecurity practices up to date.
Make an incident response plan
A 2018 Statistics Canada survey found that 87% of respondents lacked a response plan. Plan ahead to make sure your business is able to recover quickly should you become the target of a cyberattack.
Make patching automatic
You know how your systems and applications sometimes show that there’s an update waiting? These updates are usually patches and very frequently have to do with internet security. You can increase your security by selecting “automatic updates” for your systems and hardware rather than having them installed manually.
Use firewalls and anti-malware software
Getting suitable security software can protect your system against cyberattacks.
Use secure your devices Gone are the days of using default passwords.
Configure your devices by changing your passwords, reviewing settings, disabling extras, and enabling any security features.
Codify strong user authentication
Believe it or not, one of the most common ways hackers gain access is through guessing passwords. Develop a password policy, such as using passphrases, having a minimum number of characters, and including a mix of letters, numbers, and special characters. Also, consider multi-factor authentication where more than one method is required to log in.
Train your employees
Raising employee awareness about the issues and training them on the proper use of company systems and machines will reduce the risk of cybersecurity breaches, many of which depend on the ignorance or haste of the user. “Most cyberattacks are socially engineered, designed to illicit a hasty response from the user, and that is when the real damage can occur,” says Humzah Khaial, Managing Director at Numentis. “Nobody expects a computer to be infected, especially when working from home, which is why it catches most people completely off guard.”
Backup and encrypt your data
If you have a secure, encrypted back-up, you can recover quickly from a security breach.
Secure your mobile devices
Many companies use mobile technologies like smartphones as part of their day-to-day business. These devices need to be secured. Consider a corporately owned, personally enabled (COPE) model or corporately owned business-only (COBO) approach. In either scenario, users should only use apps from trusted vendors.
Adopt basic perimeter defences
Networks, Wi-Fi, and VPNs are all ways to gain access to your system. Implement defences including firewalls, encryption, and two-factor authentication.
Secure cloud and outsourced IT
If you store information in the cloud or use outsourced IT services, make sure you know how sensitive information is handled, and what protections you have. Also, be aware that if your data is held somewhere other than Canada it will be subject to different privacy laws.
Secure your websites
As a customer-facing asset, your website can’t afford a breach. Start securing it with the Application Security Verification Standard (ASVS), a list of security requirements and controls to implement during all phases of web application development.
Enable access control and authorization
Most computers use accounts where an individual must enter a username and password. Make sure you have unique logins for all employees and disable old accounts when employees leave. Don’t use shared accounts. Be sparing with who has administrator access.
Secure your portable media
USB drives, hard drives, and memory cards are all examples of portable media, and they should all be secured with encryption whether they’re in the office or not. Also, be wary of drives received from others (such as at a conference) as they may contain malware. Don’t use them until they’ve been assessed.
This list may seem overwhelming but each of these actions can prevent a costly cyberattack. “It’s critical that Canadian businesses take a 360-degree approach to managing cybersecurity risk,” says Khaial, adding that a framework of prevention, protection, and education is the most effective strategy.