28 March 2018

Finding the Funds For Property Renovation

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Only 35% of Americans are satisfied with their finances today, so it’s no wonder that many households find it difficult to acquire the extra money to fund a home renovation. However, renovation can significantly improve the value of your property. It might just be the case that coughing up the cash could pay dividends in the long run. Nevertheless, this is an important decision, and not one to be taken lightly by any household. Do examine your options fully before making a potentially costly decision. Let’s take a look at them now.

Come up with a plan

Have in mind what kind of budget you’ll want before you even start to look at financial products. Different types of renovations will need different budgets, so think carefully about the exact improvements you want to make. Will you be knocking down walls? Adding plumbing? Applying for permits? All of these are likely to add significant costs.

One thing to help with your budget is comparing the cost of tradespeople. It could avoid you needing to take out multiple loans, meaning a much lower interest rate overall, and of course, it will give you a lot more piece of mind too! Make sure to compare multiple tradespeople, and also ask for quotes rather than estimates. A quote is a more accurate reflection of the true cost of a service, and unlike estimates, they’re legally binding.

Don’t peso much for a loan!

Another thing to look at carefully is the options you might have to finance the renovation. Someone new to renovation might easily overlook what might have been the best option for them. One option is always to pay out of your own pocket. Unlike any other options, this one comes with a zero percent interest rate - which might be very appealing to some! You might think that you don’t have quite the level of savings for this, but do look carefully at your monthly outgoings to see whether it’s possible to cut back on spending in the short-run to reap those gains in the long run.

If an upfront payment is not an option for you, then when you’re comparing financial products, look for both a low interest rate, no nonsense in the terms and conditions and clear evidence that the entity you’re looking at is legitimate. Alongside personal loans and mortgages, do look at some of the less conventional options too. Consider using a P2P (person to person) lending platform, or calculating a reverse mortgage, as these methods could be end up being the best choice to make.

Safe as houses?

So, there are two big things to think about when renovating your house. Make a detailed plan and then follow through on it: calculate exactly how much the work will cost, and how you’re going to pay for it. Remember, there are plenty of frauds out there looking to make easy money by ripping people off: don’t let yourself be one of them!

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