How would you pay for a home remodel?

posted 3 years ago in The Lounge
  • poll: How do you pay for a home remodel?

    Cash

    HELOC

    Other (please specify)

  • Post # 2
    Member
    107 posts
    Blushing bee
    • Wedding: March 2018

    I live by the old adage “if you don’t have the money, don’t buy it”. I have cash flowed several home improvements. If you don’t want to touch your savings, then save above and beyond your emergency fund. Patience is key, but it’s always 100% worth paying cash and adds instant equity.

    Post # 3
    Member
    15395 posts
    Honey Beekeeper
    • Wedding: June 2011

    I wouldn’t take on additional debt for cosmetic or non-essential convenience updates to a home unless I had already factored it in to the cost of buying the home and accounted for it.  Otherwise I would only do the upgrades if I had the cash on hand for it.  And then I’d pay cash or take out the loan depending on what the rate was and if it was a better financial decision to leave the cash invested.

    Post # 4
    Member
    556 posts
    Busy bee
    • Wedding: June 2017

    We are currently remodeling our kitchen.  We ended up taking out a HELOC, but also had quite a bit of cash on hand.  In order to take out the HELOC, we had to have the house appraised (which we’d just done because we also refinanced) and submit our loan paperwork.  It was pretty painless, and we’re planning to pay back anything we extract from the HELOC at years end- but wanted it for
    “just in case money”.  That was the best option for us, but we did speak with a couple of different banks to vet what financing options were available!  Also, we’ve done quite a bit of work on our house, and even our contractor, who is excellent, tends to go over budge by a little bit.  I’ve heard that from most people who have done a home remodel to account for a 15%-20% “over budget” amount just in case. So, I’d say make sure you’re prepared to accomodate for “going over”- that seems to be the norm in remodeling. Good luck!

    Post # 5
    Member
    5761 posts
    Bee Keeper

    View original reply
    techmom :  I put other because firstly I would make sure you have the cash to back it up as if you were paying cash. So that you can pay cash OR get a HELOC at a super low rate to make payments and if you had your cash earning interest that’s greater than the APR you get on borrowing.  

    If you aren’t earning interest somewhere then just go ahead and pay cash. I just like a paper trail when dealing with contactors. 

    Post # 6
    Member
    1199 posts
    Bumble bee
    • Wedding: May 2018

    We are currently doing remodels on the house we just bought before moving in (new floors, new carpet, basement finished, fence put up, kitchen remodel) and are paying cash. This is a home from the 80’s so I’d love to update the bathrooms one day but it’s not in the cards financially at the moment. I’d advise prioritizing your remodels, do what you can comfortable afford now and do more in a year.

    Post # 9
    Member
    289 posts
    Helper bee

    Do you have any credit cards that give you money back on purchases or airline miles? You could get a little back if you first charge and then pay off with the cash you have on hand.

    Post # 12
    Member
    5761 posts
    Bee Keeper

    View original reply
    vegas62218 :  This is a great idea! 

    OP just do not carry the balance over!!+

    Post # 13
    Member
    556 posts
    Busy bee
    • Wedding: June 2017

    View original reply
    techmom :  So, my husband had a number in mind (he didn’t want to go over 50K), and I thought, just given the other work we had done on the house, we’d end up more like 70/75K.  We were able to easily calculate appliance costs (essentially anything we’d buy) and cabinets, lighting etc.  to get a rough estimate of thoe, and then we brought in a contractor we’d used before to give us his cost estimate on work and remaining supplies.  Previously, when we were starting our renovations, we just brought in several contractors to help us estimate the cost of the projects- and as I mentioned, they were close-ish at the end of the day.  We used Houzz a lot for design ideas, and then chased down the products online to help outline what the spend might be.

    I will share, for the kitchen project, we originally hired a designer because he came recommended to us.  He did a nice job, but didn’t listen to our budget constraints, and came in with custom cabinetry (not including the install or counters) at 40K.  That’s right- 40K for CABINETS.  So, we nicely parted ways,  modified his design (more to our liking) sourced our own cabinets (from IKEA- which has an incredible selection and is VERY affordable with a 25Y warranty), and saved nearly 30K.   I guess lesson learned, if you’re motivated, and constrained by budget, you can still find a way to do great things- sometimes you just need to do a little research ๐Ÿ™‚

    Post # 15
    Member
    1374 posts
    Bumble bee
    • Wedding: September 2017

    First, Zestimates are ๐Ÿ’ฉ. Please don’t go off of a Zestimate. When’s the last time Zillow came into your house to check it out? Right, never. 

     

    My husband is a contractor and together we flip homes. We’re even renovating our own right now. I’m the designer (I do not have a design degree,fyi). To cut costs, I find most of the finishing materials. Doors, tile, cabinets, vanity’s, plumbing, lighting etc. For the kitchen Reno, go to Home Depot with the exact measurements of your kitchen (ceiling height too). They will plug in all of your measurements into their program and start to build your kitchen. Work WITH them. If you don’t like where they’ve placed the sink, speak up. It’s your house. They will price out all different brands of cabinetry for you and ultimately you go with the one that is in your budget. I personally wouldn’t buy my countertops there, I go to a granite, quartz and quartzite warehouse. Be frugal. Look for sales. Floor & Decor is AWESOME for tile and flooring. Check it out. I did this backsplash for…$110!

    Heres one kitchen I just did for under $8k (material cost, including appliances). This is a low end kitchen for us. But the home still sold for asking price with 1 day on the market. 

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