Creating a Budget For Your Remodeling Project

Someone figuring out the costs of remodeling their backyard.

Adding onto your home has been a dream for years, and you want to make that dream a reality. With the addition of a deck, you and your family can make the most of the added space, and you do not have to break the bank to do so. Without worrying about the costs of remodeling, you can finally get that addition that your home deserves.

Figuring out how to budget for your new deck can be one of the trickiest steps as you plan for your home’s renovation. You need to consider a couple of things before you really commit to the project. First, what materials and style are you looking for? And second, how will you finance this remodeling project?

With a new deck, you will increase both the outdoor and/or indoor living space, which will also increase your home’s value. It is possible that your new deck can also have at least a 60 percent return on investment, but that is also based on building materials. A deck can be made from natural hardwood or composite, plus the railings can be made of different materials. 

Other factors will determine the cost of your deck, but they are still parts that you can be in control of, just like the materials. You can choose the shape and size of your deck, including building multiple levels. Also, consider if you have an existing deck you are going to either build using your existing structure or remove and start fresh.

As for how you will pay for the remodel, fortunately, there are multiple ways that you can finance the construction. The first and most straight-forward way is to spend cash that you have already saved away. But consider an alternate method, as you could set aside that cash for investments, and you should compare possible interest payments on a home improvement loan.

The Federal Housing Administration has two special loans available for home remodels. The first is the Title I program, which are fixed-rate loans that allow you to borrow up to $25,000 for improvements to single-family home. Another option is the 203(k) program, which gives homeowners a single, long-term, fixed, or adjustable rate loan that covers both the acquisition and rehabilitation of the property.

Next is using a home equity line of credit, where your home serves as collateral. These allow you to pull from these funds whenever they are needed. But if you are not comfortable using a line of credit, you can choose a second mortgage, or home equity loan, which is a fixed-rated, fixed-term loan based on your home’s equity.

Last is refinancing your mortgage, whereby taking out a new loan can pay off your existing mortgage, and the remaining funds can be put toward your remodeling project. Things to consider before going with this option include how long you plan on staying in your current house, and the number of years you have left on your mortgage payment. 

One of the most important considerations for your home improvement project is financing. After all, the project will go nowhere if you can’t pay for it. Fortunately, there are several options that can provide the dollars you need. When your home needs that extra space and extra connection to the outdoors, the builders at Signature Decks can help guide you through the process and give you all the advice you need.

At Signature Decks, all of our projects bring the strength and durability that you would expect with a fresh addition. For more information on the benefits of adding a screened-in room to your house, call Signature Decks today at 616.896.2866. As a premier remodeling company, it is our duty to provide the customer with their dream construction.

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