It’s a brand new year, which means many homeowners want to change something about their house. Maybe you want to renovate one room or maybe you desire a full renovation. Whatever your goals, budget will be a factor. While many folks long for the home of their dreams, they have to be realistic about how much money is available to spend. It’s hard to enjoy a beautiful new room or home if you’re stressed about money.

Obviously, saving money beforehand and paying for the renovation outright is the smartest move to make, but that isn’t the reality for some people. If you need help finding the budget for a renovation, we offer several suggestions.

1). Home equity line of credit:This type of funding is good if you have enough equity on your home. Interests are very low because you’re putting your home up as collateral. The tricky thing is if you routinely miss payments, your home could potentially be foreclosed upon. Before considering a home equity line of credit, ensure the value of your home is significantly higher than the amount you still owe on your mortgage.

2). Personal loans: This type of loan is unsecured so interest rates would be higher. Some benefits to personal loans are typically easy to acquire and quick to process, meaning you will get the money in your pocket early. There are many personal loans available. You can apply online, in person, or through a mail-in application.

3). Refinance: When refinancing, your existing mortgage is replaced with a new mortgage with a different interest rate. If the new loan is larger, you can pocket the difference and use the extra dollars for renovation purposes. If you plan to refinance, there are other fees and costs you’ll have to consider. These include an appraisal, origination fees, taxes and closing costs.

4). Government loans: This type of loan is more challenging to acquire than other types of loans because of the underwriting standards. Before deciding on this type of loan, be sure to do your research. One benefit of a government loan is you can obtain one without having significant equity in your home, so if you’ve recently purchased your home and want to renovate, this would be a great option for you.

5). Renovation loans: Some banks offer a renovation loan up to a certain amount. You have to qualify for these types of loan when purchasing or refinancing your home. The loan amount is rolled into your monthly mortgage payments so you won’t have an additional payment each month in addition to your mortgage.

6). Credit cards: If your desired renovations are minor or below a certain cost, using a credit card may be the best option. Using credit cards can be dangerous because of their high interest rates, but if you plan to pay them off quickly, they work well. When using a credit card, you can also take advantage of 0% introductory rates or 0% interest on balance transfers.

We do not suggest going into debt in order to renovate your home. Thereare many options available to help you pay for updates. Research these options and decide which is best for you. The Braemar team will ensure we maximize your budget to the greatest degree in order to create the home you’ve envisioned.