How You Can Finance Your Home Renovation

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Real Estate

How You Can Finance Your Home Renovation


The kitchen is outdated. Backyard has become overgrown. Basement is unusable. If you are planning a home improvement project, the first thing you must consider is how you will finance it.


Here are some of the most common ways to make your dreams a reality:

Cash. Paying in cash is the simplest financing option; simply save until you have enough money to cover the expenses. This will help you avoid spending outside of your budget, but it will also lengthen your timeline.


Refinance your mortgage. If you've been making mortgage payments for a few years and your interest rate is higher than current market rates, you may be eligible for a mortgage refinance, which will lower your payments and free up some money.


Refinance with Cash Out. You can use your home equity to borrow up to 80% of the value of your home to pay off your current mortgage and take out additional funds to cover the renovations. This option is recommended only when making improvements to increase the value of your home, as it can add a significant amount of interest and fees.


Equity in one's home. A home equity line of credit allows you to borrow money based on the value of your home. Typically, you can receive up to 80% of the value of your home, less the amount of your loan.


Retirement Accounts. Homeowners should consider withdrawing funds from a 401K or IRA account, even if they aren't specifically designed to cover home renovations. This option may result in additional penalties or tax payments, but it may be worthwhile if they are making improvements that will benefit them financially in the long run.



For more information on this or referrals for trusted people to use, for finance, or to do these renovations, or the value of doing these renovations. Please contact us at 203 733 0147/ | | Marvin & Laura Beninson