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Financing Options for Your Summer Renovation

Financing Options for Your Summer Renovation


Is this the summer you’re going to dig in to that special home project you’ve been wanting to accomplish for years? Many homeowners are eager to make their outdoor living space as perfect as possible by adding a new deck, patio, ‘she-shed’, fence or maybe a swimming pool – just to name a few of the most popular summer projects. However, these projects can end up being more complicated and costly than first planned, which can trip up even the most organized and financially savvy people. As a result, I’ve outlined some of the major considerations to help you get started on your big project:

1.Plan ahead & plan some more

Before you start digging or heading off to the hardware store, you’ll want to sit down and go over a few key factors before you get building to prevent any unwelcome surprises. Careful planning is essential for all home renovations, both indoors and out.

  • If you’re using a contractor, get at least 3 estimates in writing, and book their services well in advance as summer is the most popular renovation season.
  • Draw up the proper designs or blueprints – don’t forget to factor in any electrical or plumbing needs as well.
  • Apply for all and any local building permits.
  • Don’t start digging until you’ve gotten the go-ahead – especially for natural gas, hydro or septic considerations.
  • Notify your insurance company as your renovation may impact your policy.
  • Source out building materials, tool rentals or décor items you will need.
  • Set up a budget, then add 15% to 20% for those inevitable ‘extra expenses’ that will crop up.
  • Do up a cost analysis – for example, an inground pool may be too costly once you factor in ongoing maintenance, repairs, hydro costs and so on, and it likely won’t add to your home’s value when it comes time to sell.
  • Once you’ve got a design/plan in place, be sure to stick to it. Last minute changes and additions can throw you off course, delay the project, and usually result in going way over-budget.

2. Financing options

Most renovations such as decks, sheds and fences are a great investment; they increase your home’s value while adding more enjoyment to your living/outdoor space! The big concern for many families is figuring out how to pay for the renovations without causing financial hardship. While you could dip into your savings, your line of credit, or access money in your TFSA for example, a great option may be to use your home’s equity to foot the bill.

Home equity is the difference between what’s left owing on your mortgage and the value of your home (done through a formal home assessment). If you’ve owned your home for more than a few years and have made regular mortgage payments, there’s a good chance you’ll have built up equity in it that you can take advantage of. Home equity loans tend to carry a fairly low interest rate, making the repayment of it more manageable than other types of loans. You certainly wouldn’t want to rack up any credit card debt for your summer project…interest rates on those can be upwards of 17% to even 25% or higher.

Does your summer renovation project need help to get it going? If you’re thinking that you’d like to take advantage of a home equity loan to financially fuel your project, be sure to connect with me. As an experienced, certified mortgage broker in Barrie, it’s my job to help you determine whether or not a home equity take-out is best for you and walk you through the process so there are no surprises. Contact me today at (705) 315-0516 to learn about how I can help, so you can get started with that important project and get on with your summer plans.

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