It’s DIY season – the time of year we roll up the sleeves and tackle those much-anticipated home improvement projects we fantasized about all winter long. Renovations and remodeling are the best way to transform a space for the better and offer significant upside by adding some serious value to a home.
Turning a home renovation dream into reality, especially a fixer upper, though, will involve a financial investment – a tough pill to swallow if you do not have money saved up and readily available.
THE AVERAGE COST OF HOME RENOVATIONS AND REMODELING PROJECTS
A homeowner will spend nearly $47,000 on home renovation costs, with the exact dollar amount fluctuating based on the room(s) being updated, square footage, cost of materials and labor and the region you reside in.
Now, a route many people – one in three homeowners, according to a 2018 study – will take is using credit cards to charge for home improvements. While it may make financial sense in the short term, especially if you have credit card reward programs, instead, you could end up paying more in the long run with fees and high interest rates. Higher monthly credit card bills could take a toll on your credit score and affect your overall financial health.
So, if you do not have money on hand or credit cards are not a viable option, how do you successfully finance a home project without sinking into debt? A cash-out refinance might be the right option.
WHAT HOME IMPROVEMENTS CAN YOU USE A CASH-OUT REFINANCE TO FUND?
With a cash-out refinance, you receive money based on the equity in your home. The best part – there are no limitations to how the cash can be used for home improvement projects. With home renovations, you want to focus on projects that offer the best return on investment, or ROI.
For example, a kitchen makeover – even the simplest of upgrades, such as painting the walls or installing a new backsplash – can add equity and increase the overall value of your home. An upgrade that adds significant ROI, but is the last thing on most people’s mind is the garage door. Yes, replacing your garage door increases your home’s curb appeal, value and ROI. Take care of those long-awaited home repairs or bring your renovation dreams to life without breaking the bank and having to sacrifice your monthly budget. Home improvements, including expensive, large-scale projects, are within reach.
Interested in a cash-out refinance? Discover how much money you could put towards a home renovation with a loan from Union Home Mortgage. Use our refinance calculator and see your new monthly balance right now.
SHOULD I REFINANCE TO PAY FOR HOME IMPROVEMENTS?
There are several advantages to cash-out refinancing to fund home remodeling projects, including:
Lower Interest Rate
You may be able to take advantage of a lower interest rate or shorten the term of your loan.
Increase Home Value
Invest in home repairs or improvement projects to increase the value of your home.
Improving your home will enhance the living experience and boost your home’s equity and property value.
When you cash-out refinance, you get to take advantage of your home’s equity by adding to your home loan for renovations. Investing money back into your home increases its value and creates the opportunity to pay off high-interest debt, such as credit card bills, car payments and student loans.
READY TO USE CASH-OUT REFI TO UPGRADE YOUR HOME?
If you want to invest in your home without racking up debt, cash-out refinance may be your best option. Speak with Union Home Mortgage today and explore refinancing options and discover how much money is in your home and available to you. As your trusted cash-out refinance lender, Union Home Mortgage matches you with the best loan at the lowest rate.