Cheap Remodeling Ideas
Renovating or remodeling your home does not
have to be expensive. Whether you are trying to update and remodel a house to
get it ready to sell or to make it a more comfortable place for you to live,
there are plenty of ways you can fix up your house without spending a lot of
money. These changes will:
- make your house a more comfortable place to live,
- help increase the market value,
- make it look better for your guests who visit,
- and let you enjoy your house to its fullest extent.
Here are some tips on how to save money as
you remodel, renovate, and beautify your home.
Remodeling and Renovating on a Budget
Remodeling and renovating a home does not
have to be expensive. Here are a few ways to remodel your home without breaking
the bank.
- Make changes that have a big impact.
- Considering small things that make a big difference.
- Do it yourself.
- Trade and barter for labor.
- Borrow or rent tools.
- Shop around for the best price.
- Consider your needs when you buy.
- Buy second-hand goods.
- Think creatively.
By using the tips provided, you can save a
great deal of money while increasing the functionality and beauty of your
home.
Make Big-Impact Changes First
To save money, you want to consider making
the changes that have the greatest impact first—the things that will get the
most bang for your buck. Things like paint, flooring, lighting, and arrangement
and existence of appliances and furniture. A fresh coat of paint can quickly
and economically update, brighten and enhance a home.
Then, if you still have money in the
budget, you can make the changes that will enhance the home in more subtle
ways.
Smaller Changes That Can Have a Big
Impact
In addition to thinking big, you should
also think small. There are small changes you can make that make a big impact
as well.
- Changing the hardware of cabinets, for example, can change the look of the kitchen without having to replace the cabinets.
- Painting the trim instead painting the whole house might be sufficient depending on your situation.
- Adding a drawer organizer might keep you from needing another drawer.
- Repairing instead of replacing some things could avoid headaches and cost less, depending on the amount of time and material it would take to repair them.
- Changing the rug or towels in the bathroom, or a new bedspread or curtains in the bedroom can change of the look of the room without any remodeling whatsoever.
Understanding when is a home equity loan a good idea
A home equity loan is a secured loan. You
offer your home up as collateral, and in exchange the bank extends you money
that has to be paid back over a specific period. Since your home acts as
collateral, you can usually get better terms on the loan than you would without
collateral being offered. And you may save money on taxes based on your
individual situation.
This means that you can get a
lower interest rate on the loan than what you’d qualify to receive on
a loan without collateral. Low interest means you’ll end up paying less money
over the life of the loan.
For example, the total interest paid on a
3-year loan for $10,000 at 5 percent APR is $789.52, while at 6 percent APR the
same loan would cost $951.90 with added interest. The monthly payments are also
slightly higher at six percent versus five, because you have to pay more within
three years to pay it off with interest added – the difference is about $5 on
this example.
So on one hand there can be good reasons to
use a home equity loan.
Increasing my mortgage – what is a further advance?
A further advance is taking on more
borrowing from your current mortgage lender.
This is typically at a different rate to
your main mortgage.
This route can make sense if:
- Your lender’s further advance is competitive
- You don’t want to remortgage or switch lenders.
You can spread your payment over a long
term and your interest rate should be lower than a personal loan.
But always check the market to see if you
can get a better deal before committing.
When a further advance might make sense
There are two situations when a further
advance might be suitable:
- To fund home improvements
- To raise a deposit for a second property, perhaps as a
buy-to-let investment
Can I Get A Mortgage For More Than The Value Of The Property?
The family member has had the house valued at $120,000 but has offered it to us for $70,000 to help us on to the property ladder.
The house is in need of a rewire, central
heating and new windows, bathroom and kitchen.
As the house is valued at $120,000, would it be possible to take out a mortgage of $100,000 even though we are buying the house at $70,000?
No lender will give you a $100,000 mortgage to buy a property costing $70,000. Any mortgage offer will be based on the purchase price of the property – even if this is lower than the actual value. And the most you’ll be able to borrow with a conventional mortgage would be 90% of the price which, in your case, would be $63,000. To be able to get a mortgage of $100,000 you would need the purchase price to be just over $111,111 and to be able to put down a cash deposit of $11,111.
That’s not to say you won’t be able to
borrow to pay for renovation costs as most mainstream lenders are prepared to
lend money for building costs but they don’t pay the money up front which
wouldn’t suit you. Instead any money lent is paid after the building work is
complete and the property has been revalued.
To be able to pay for building works before they are finished, you’ll need a specialist renovation mortgage such as those available through Buildstore Mortgage Services. Its Ideal Home Improvement mortgage allows you to borrow up to 95% of the cost of the property as well as up to 95% of the improvement costs. So you might be able to borrow $66,500 to buy the house and $28,500 to put towards the cost of renovating. You’ll still need to find cash for the deposit on the property and the first 5% of renovation costs.