Renovation financing is a good way to fund your dream home’s upkeep, maintenance and giving it that great new look.
Renovation loans are available if your premises is in a state of disrepair, is unlivable, needs up gradation or if you want to just put in new kitchens, bathrooms etc.
Very simply, often times people will hold off on getting the home renovation they need simply because they don’t believe they can afford it. however, when you realize all the financing options available to you, you will know that it doesn’t have to be nearly as expensive as you think.
Even drastic improvements like completely removing all the built structure and rebuilding it using existing foundations can also be sometimes funded by renovation financing. Although financing a home can be supported by your personal finances, sometimes it does make sense to finance the project especially if your home itself can finance the renovation.
How? Simply because if the price of your home has exceeded the mortgage on it you are sitting on top of what is called home equity.
Home equity can be an excellent source for financing the renovation of your house. Home improvements financed by credit cards may be a possibility but getting a loan based on your home equity will get you a way lower rate of interest.
Since loans offer structured repayments over a period of time, they are also easier to pay off than your increasing credit card debt. So avoid the temptation to fund your home renovation using your credit card unless you can pay off the balance quite soon.
What Kinds of Renovations REALLY Pay Off?
Things that people think really add on to their home value often do not. Beyond that, a lot of this kind of determination really comes down to if you are actually planning on staying in the home or if you already know you’re going to sell it. If you want to get a return at sale time and you already are planning on selling, what will recoup your cost? Bathrooms and kitchens are almost ALWAYS going to be no-brainers. Check out this article over at HGTV – Bathrooms and Kitchens. These kinds of improvements will get you your money back PLUS.
And obviously, if you expand your heated square footage by adding on another room / wing to your home, that DEFINITELY will increase your home value. In some cases, people have very large attics that would not take much work to close in and turn into an extra bedroom – or just a simple den. While a brand new spiffy deck out back may very well increase the salability of the home, the money that has been put into that deck will often (and usually) be greater than the home value increase. In other words, you’ll likely spend 10K on a brand new spiffy deck, but you may only add a few thousand to your home value.
NOW, if you’re planning on staying in that home for a long time, then the enjoyment you will get out of that deck will likely exceed the money spent on it. The HGTV article even points out if you are planning on staying in the home for a while, you’re really doing this for yourself. If you’re doing it for yourself, then you can do whatever you WANT!
Bathrooms – Upgrades and Refinishing
Maybe you DO want an upgraded bathroom or just some bathroom refinishing of your existing items. It is a room that people use every day and it is refreshing to have good looking fixtures and be comfortable. Your bathroom can either be a complete gutting and start over with a layout that you like or it can be just an upgrade or refinishing project.
If you go whole hog and want to change things around considerably, it can get expensive. Have one of those “once in vogue” garden tubs that you absolutely NEVER use? You might replace it with a shower that is much more in tune with your lifestyle. This may turn into redoing some plumbing lines and maybe even moving around some electrical lines. But it may also turn into extra room in your bathroom that will allow someone to actually move around without bumping their elbows. Many bathrooms truly are cramped for anything but the most basic of uses. You probably are not looking for a streaming water fountain in the middle of YOUR bath, but being able to actually dress in your bathroom without going through major contortions can really be handy.
Something simple that can be done is some repainting and maybe refinishing or replacing some of your fixtures. An elegant clawfoot tub with new porcelain can be quite an eyecatcher. Replacing a built in tub with something of elegance (if your bathroom space allows it) can make a dramatic difference. You can see some great before and after bathroom refinishing pics. Replacing a built in though can turn into a bigger project as you will likely then need to redo flooring where the built-in was. If your tub is just looking worn or is a boring white, and you want to make something really pop, some refinishing can dramatically change the drabbest of bathrooms in a day. This is often far less expensive than you might think. DEFINITELY cheaper than any kind of replacement.
Kitchens – Great all around improvement
Another room that is used everyday that will not only return great sales value, but can also give you great enjoyment if you stay – the kitchen. Many people move into homes that haven’t always been so thoughtfully put together as far as the kitchen cabinets are concerned. I personally have a long row of cabinets overhead in my own kitchen so I fall into this category. While they may provide a decent amount of storage, they’re not actually very thoughtfully laid out. They were likely about the least expensive thing the developer could put in there. Sadly.
You can go to your local Lowe’s or Home Depot and purchase new cabinets and have them installed to give your kitchen a new fresh look. If you are contemplating being in the home for a while, you have an oddly laid out kitchen or you just want something more than the average stock kitchen cabinets can provide, you might want to talk to a local custom cabinet company. Custom cabinet makers will come in and do the measurements and actually fashion the kitchen woodwork the way you want it. You will have complete control of the woods and finishes used so it gives the homeowner the max in customization. Additionally, you will have an experienced professional that can give you some insight well above and beyond what the average Lowe’s or Home Depot employee can.
Smart Upgrading Makes It Worthwhile
Getting your home renovated does not have to be a huge back breaking financial task. Just use a bit of ingenuity and your home can sometimes just pay for the improvements on its own. Renovation financing is something that everyone who is thinking of redoing their home should seriously consider. Don’t let a lack of finances stop you from getting the home of your dreams.
Check out our posts for more home renovation and remodeling ideas and tips!