![]() ![]() Get recommendations for at least three contractors from friends, neighbors, and other tradesmen who you trust. By specifying these details up front, you ensure that prospective contractors are all pricing the same items. Get Quotes from Contractorsīefore seeking bids, determine exactly what you want, right down to the kitchen countertop material and the type of faucet. ![]() Related: 6 Ways to Pay for a Remodel When You Can't Tap Home Equity 3. If you can't afford that much, then you should reconsider your project. You can do this by paying 1/60th of the principal (for a five-year pay down) or 1/120th (for 10 years) in addition to the monthly interest. Instead, establish your own repayment schedule. Like only paying the minimum due on a credit card, that's a recipe for getting stuck in debt. The catch is that the minimum payment on a HELOC is just that month's interest you're not required to pay back any principal. A HELOC is a loan that's secured by your home equity, which means that it qualifies for a lower rate than other loan types, and you can deduct the interest on your taxes.īecause a HELOC is a line of credit rather than a lump-sum loan, it comes with a checkbook that you use to withdraw money as needed, up to the maximum amount of the loan.įor help shopping for a HELOC, download our free worksheet. There are three basic types of loan options:įor the vast majority of homeowners, the best way to borrow for a home improvement is a home equity line of credit. ![]() But if you're borrowing, you need to assess how much a bank will lend you and what that loan will add to your monthly expenses. If you're paying cash, that's easy to answer. Once you've zeroed in on a project, the next question is whether you have the money. ![]()
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