Whether your home remodeling Phoenix project is simple, such as increasing the energy efficiency of your home, or more encompassing like customizing your home via a kitchen remodeling or master bathroom remodeling project, you will need money for the remodeling budget for your dreams to materialize.
If your house isn’t how you want it to be, waiting to do home remodeling may not make sense, for the cost of materials and labor do not go down, but up over time. Besides, if you divide the cost of the home remodeling project, by the number of days you enjoy it, it is cheaper to do it now, rather than later! It can be wise to keep investing in your home to keep it current, so when it is time to sell, little will need to be done.
Determine how much you plan for your remodeling budget, and how you will pay for the remodeling project. Some general contractors do not take credit cards, or do not accept the payment terms for 203K loans in escrow. It can be a cost savings to select a design-build remodeling firm who has experienced designers who can make a plan to within your budget and help you with selections to get the most for your money.
Cash—If you have all or some of money set aside, and plan for an extra 10% for any add ons you make during the project. Ask if the general contractor offers a discount for paying with cash.
Credit Card—This makes sense if you pay off your bill each month, or have opened a new credit card account that has a promotional special of 12 months interest free, making it an interest free loan. People like to use their rewards cards, but it may not make sense if one loses a cash discount. However, if you have to charge a certain amount a year to get a perk such as a companion pass for flights, it really could add up to be a greater savings than the cash discount.
Unsecured Loan—If you have excellent credit, you may want to get a short term personal loan from a bank or credit union.
Home Equity Loan—You can secure a loan on as much as 80% of the equity of your home. The advantage to this type of loan is the interest rate can be tax deductible. The risk is if you default, your home can go into foreclosure.
Purchase or Refinance Mortgage—This can be a conventional or FHA 203(k) loan for your primary home which has the tax advantage and has lower monthly payments for it can be spread over a longer term. The program will consider the value of your home after the project is completed. The disadvantage of this type of loan is without equity, mortgage insurance will be required.
If you are going to get a loan for your home remodeling Phoenix, you may want to check with a trusted financial advisor to help determine what type is best for you.
Happy Home Remodeling Phoenix!