8 Home Renovation Tips for Homeowners
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Editor’s note: Lantern by SoFi seeks to provide content that is objective, independent and accurate. Writers are separate from our business operation and do not receive direct compensation from advertisers or partners. Read more about our Editorial Guidelines and How We Make Money.
What Is the Average Home Renovation Cost in 2023?
Home Renovation Tip 1: Focus on Projects That Increase Efficiency
Home Renovation Tip 2: Embrace Natural Lighting
Home Renovation Tip 3: Utilize Recycled Material
Craigslist Facebook Marketplace Planet Reuse Reusewood.org Habitat for Humanity Restore Local salvage stores
Home Renovation Tip 4: Learn to Do It Yourself (DIY)
Home Renovation Tip 5: Consider Long-Term Costs
Home Renovation Tip 6: Work With Licensed Contractors
Home Renovation Tip 7: Review the Contract
Home Renovation Tip 8: Secure the Funds for Home Renovation Early
Ways to Fund Home Renovations
Personal loans: You can use these loans for improving your home. With a personal loan, you borrow money from a bank, credit union, or online lender. You get the funds as a lump sum that you pay back in regular installments over time with interest. The higher your credit score, the lower the personal loan interest rates you may get. Once you’re approved for a personal loan, you may expect to receive funds quickly, typically within one to five days. Home equity line of credit (HELOC): A HELOC is a secured loan backed by your home that allows you to access the equity you have in it. A HELOC is a revolving credit loan, which means you can continue borrowing whenever you need money, up to your credit limit. After this borrowing period is over (it’s called your draw period), you repay your loan over a period of years. However, if you default on a HELOC, you could lose your home. Home equity loan: This type of loan allows you to tap into the equity on your home, like a HELOC does. However, a home equity loan gives you a lump sum of money that you repay over time instead of a revolving line of credit. But again, just like with a HELOC, if you fail to repay the loan, the lender could seize your house. Cash-out refinance: With this method, you replace your current mortgage with a bigger loan that has a new interest rate. You use the extra cash to pay for your renovation. However, you will have to pay closing costs with a cash-out refinance, so do the math and make sure it’s worth it. Credit cards: You could put the cost of a renovation on your credit card. You might be able to qualify for a new card with a 0% introductory APR, which means you wouldn’t owe interest until the introductory period is over. However, unless you can pay off the balance in full by that time, you’ll owe interest on the remaining amount. Credit card interest rates tend to be quite high. Also, you’ll need a credit card with a high enough credit limit to cover the renovation cost.
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