Homeowners: Should You Remodel or Refinance?- To remodel or to refinance? That is the question. This has been a long-debated question that brings about many others. Should I wait to refinance my home until my remodeling is complete? What if I want to use some of that money to fund my remodeling? Maybe I should get a construction loan, finish the improvement projects, and then refinance both of my mortgages? Relax, take a deep breath, and before you drive yourself crazy thinking that it’s either refinancing or remodeling, remember that you can do refinancing and remodeling.
Sure, you could shop around for an equity loan based on the current appraised value of your property. Or if you’d rather try to get a loan based off of the projected value of your home once remodeling is complete, you could get a construction loan. The cost of remodeling typically surpasses the current value of the home, making a construction loan seem like the best option. However, each of these loans has some potential pitfalls.
Both equity loans and construction loans are usually considered second mortgage loans. The danger? These either carry higher interest rates starting off or they will have an adjustable rate, one that starts low but ends high. You could feel the extreme strain of high or changing interest rates during your remodeling period. On top of all of the pre-existing stress of remodeling, the last thing you need is financial pressure.
The solution? You can kill two birds with one loan. Some lenders are now offering a first mortgage refinance to get your lower rate while also borrowing money for home improvements. The best part? You’ll get that low interest rate and your borrowing for improvements is not adjustable. Low rate today; low rate tomorrow. It really is the best of both worlds. Not all lenders, however, offer these kinds of loans, so be sure to shop around to track them down.
So where do you go from here?
- Decide on what remodeling you want done and price out how that looks just for your own reference.
- Re-familiarize yourself with the current state of your mortgage.
- Shop around for lenders who offer the refinancing and borrowing loans.
Take this information to heart and start figuring which lender will help your goals become realized. When it comes to remodeling and refinancing, why bother trying to pick just one when you could have them both?
About Deborah Laemmerhirt
Let me assist you in finding everything you need to know about buying or selling a home! As the preeminent real estate professional in my community, I am dedicated to providing the finest service available while breaking new ground.
Because the real estate industry is becoming more sophisticated and challenging every day, you need a professional that understands the industry and is positioned to stay ahead of the game.
I go the extra mile to help you achieve your goals. That’s why I constantly research the home, market and estate values so your home is priced effectively from day one. I also make sure the public knows your home is for sale by using innovative marketing techniques to attract potential buyers.
As an Internet-savvy real estate representative in Connecticut, I’ve had the opportunity to help many home buyers find their ideal homes and many sellers obtain top dollar for their homes. Buying or selling a home is one of the largest financial transactions that most people ever undertake, so I will help you through every step of the process. My goal is to make your home selling or buying experience as easy and enjoyable as possible.
My services include:
Explaining the home selling and buying process thoroughly
Diligently selecting homes that meets your criteria
Pricing your home correctly and implementing a unique yet proven marketing plan
Negotiating on your behalf
Tracking the closing process to ensure a smooth transaction
I welcome the opportunity to address any questions you might have about buying, selling or current market conditions. Please call or e-mail me any time, and I will be happy to discuss your next steps in the buying or selling process.
I specialize in both Residential and Commercial Properties.
I also head a Real Estate Group to provide you with expert service and support.
Areas of Expertise
Making transitions in your life is challenging. You may be moving from out of town, a different state, internationally or just next door! Regardless of the distance I am prepared to respond to your unique needs.If you are a BUYER looking to downsize, up-size, want a new construction, desire a condominium, to invest, even if this is your first home, I will design a unique plan to fulfill your needs in a reasonable time frame, with the best negotiated price and the least amount of inconvenience.For my Home Sellers, I have an innovative marketing plan that will leave nothing to chance. Just call, and I would be happy to share the DIFFERENT and SUCCESSFUL TOOLS I utilize on each of my listings.
I have lived in Connecticut for over 35 years. I practice Real Estate in Fairfield County, New Haven County and Litchfield County. This includes, but is not limited to Bethel, Bridgewater, Brookfield, Danbury, Harwinton, Kent, Litchfield, New Fairfield, New Milford, Newtown, Oxford, Ridgefield, Redding, Roxbury, Sherman, Southbury, Warren, Washington, Westport and Wilton.
