Reno the home or cottage?

Renovations for the home or cottage?

Renovating a home, whether you’ve just purchased it or you’ve lived in it for years, is one of the fastest ways of increasing the home value. While home renovations can become costly, refinancing the mortgage can help to offset the costs of the renovations. A refinanced loan is a new loan that pays off current debt, so that debt is not eliminated in the process. It offers borrowers the chance to switch up their loan; get one with better terms or features that help improve their finances. There are both advantages and disadvantages to refinancing that homeowners should be aware of.

The advantages and disadvantages of refinancing

Refinancing can have many benefits. A refinanced loan can save the borrower money on interest costs due to a lower interest rate, and by lower monthly payments. Lowering the monthly payments can lead to more money available in the budget for other expenses, such as home improvements. Borrowers may want to consider refinancing into a shorter term loan if they are looking to get rid of debt quicker. Also, if they are comfortable with making larger payments. When refinancing, borrowers can consolidate multiple loans into one. This is beneficial if the interest rate of the refinanced loan will be lower. Home owners that have estimated their home repairs at a certain price may benefit from a cash-out refinance. This helps prevent home owners from straining their budget and they can pay off their home as originally scheduled.

While refinancing has many benefits, there are a few disadvantages that borrowers should be careful of. Refinancing home loans can become quite expensive when paying closing costs on the current loan. This can add up to thousands of dollars, so it’s best to ensure that you’ll be breaking more than even. Making sure that you break more than even will guarantee that you have enough money for closing costs and will also free up cash for renovations.

Design on a dime

Renovations, whether small or large, can increase a home’s value when looking at resale. Tackling upgrades that increase the home value, as well as customizable upgrades for the home owner, can both pay off in the long run. Making two lists, one for each category can help homeowners tackle renovations and keep projects achievable. Replacing old faucets, doors, and lighting are easy ways to increase the resale value. Creating extra space, whether repurposing a room or reorganizing the layout of furniture, for an expanding family is a good way to add resale value while tackling the needs of the family.

Not only can home owners increase the value of their home through renovations in the interior of the house, but curb appeal plays a crucial part in the value of the home. Updating the exterior of the house can increase the resale value tremendously! Not only can landscaping make a garden look nice, but by planting plants that are eco-friendly can help save money. More information about making your garden greener can be found here.

Looking at renovating your home while also renovating your mortgage? Contact Clinton Wilkins Mortgage Team and we will help you refinance your loan so that you can get the most bang for your buck!