Home improvement has become a major industry, representing a significant portion of the world economy. It involves remodeling, repair and construction. The market is booming and the demand is growing, as the US continues to hunker down in the aftermath of the recession. In the last two years, the average home improvement project cost $10,636.
There are many different types of home improvements, from new siding to a new driveway. Fortunately, there are several loans designed to help you finance your project. One option is a home equity line of credit. This can be used to make the improvements you need, and is available to people with home equity. Another option is a personal loan. However, this isn’t necessarily the best choice, as it will have higher interest rates than other options.
While there are several different financing options for home improvements, the most affordable option is your existing bank. You can obtain cash by renegotiating your mortgage or refinancing your existing home loan. Also, your existing mortgage lender is invested in your home’s value growth, so he or she may be more apt to approve your loan than a non-mortgage lender.
Some lenders offer special rehab loans for home improvement projects. These may be easier to qualify for, and can be a good option for homeowners who don’t have enough home equity to cover their renovations. Alternatively, you could consider getting a second mortgage to get the cash you need.
A home improvement credit card may also be a good option. These cards offer low APRs for minimal upgrades, such as a new TV or appliance. They can also be a useful tool for emergency repairs.
A good home improvement plan will help increase the value of your home, which will pay off in the long run. It’s a smart move to keep your upgrades in line with what your neighbors are doing, as well as what potential buyers are looking for. Invest in quality upgrades that will appeal to a wide audience.
Despite all the options for home improvement financing, it’s still a good idea to do your homework before making any major purchases. If you’re unsure about which loan is best for your needs, you can talk to your bank to get the lowdown. And remember, you might not want to overspend on a new stove, but a new front door or a fence might be worth the investment.
Of course, one of the biggest advantages of doing a home improvement is tax deductibility. Many home improvements, such as adding insulation, installing a new septic system or updating the garage, are deductible.
Similarly, you’ll likely see tax benefits from other improvements such as a new driveway, a new kitchen or bathroom, and the like. Keep in mind, though, that you’ll need to keep track of your expenditures and itemize your receipts to claim the tax break.
If you’re considering a home improvement, the best option is to do your research, find a trustworthy contractor, and make a realistic estimate of the cost. Otherwise, you might end up with a project that will hardly enhance your home’s resale value.