Do you feel the excitement to remodel your home, but you don’t have enough cash to advance your plan? There are several options you can consider, like taking a U.S. Federal Housing Administration (FHA) backed loan from reputable lenders. Applying for loans like the FHA cash out refinance program enables you to renovate your home affordably.
The stability of the U.S. housing market makes it ideal for homeowners to refinance their existing loans and get better deals. According to Wharton professor of real estate and finance, Susan Wachter, the move by the Fed to reduce interest rates in 2019 resulted in a surge in existing home sales. Her view was supported by Freddie Mac chief economist Sam Khater, who projected an around 3% increase in house sales in 2020.
How to Prepare and Advance Your Home Remodeling Plan Successfully
Implementing your dream designs to your home is not an easy decision to make. There are many things to consider, like whether your budget is sufficient and where to get extra cash if needed. These tips will help and guide you in advancing your home renovation project successfully.
- Determine a realistic budget – A home remodeling project can be costly, depending on the scope of work to be done. You may consult with a renovation expert to have a better idea of the pricing of both labor and materials.
- Prepare your finances – After having a clear idea of your potential expenses, find enough cash to fund your remodeling project. You can use your home as a mortgage to raise sufficient money. Several lenders offer FHA cash out refinance loans at affordable rates, so better take advantage of them.
- Look at the essential work to be done – Have a clear picture in mind on the purpose of your renovation. Do you want a complete makeover or only minor improvements?
- Find a temporary abode – If you are making a complete makeover of your residence, it would be best if you find a temporary home. You can ask a relative or a friend near you if you can live with them during the process or you can rent a space. If you opt to stay home, be prepared for the noise and other inconveniences you will encounter.
- Hire the right contractor – Make sure to find a competent and conscientious contractor for your project. You can ask for referrals from friends, relatives, and acquaintances. However, don’t rely too much on word-of-mouth recommendations. Conduct your research and look for your contractor’s certification, licenses, lien history, bond number, certificate of insurance, etc.
- Prepare for any eventualities and stay positive – A remodeling project may give you lots of stress. Make sure to keep things in perspective and have extra cash ready to prepare for the unexpected.
FHA Loans
FHA loans like the cash out refinance are mortgages insured by the FHA. It includes an insurance premium to protect the lender from possible default by the borrower. The cash out refinance loan is a practical way to consolidate your debt due to its many benefits like it being tax-free.
A home renovation is a worthy endeavor if done the right way. With a positive attitude, the right contractor, and a sufficient budget, you can realize your dream home designs in your abode.
Veeramachineni Lalitha
I am Finance Content Writer. I write Personal Finance, banking, investment, and insurance related content for top clients including Kotak Mahindra Bank, Edelweiss, ICICI BANK and IDFC FIRST Bank. My experience details : Linkedin