Thinking Renovations ? Time to Renovate !

Renovating an established home

Renovating your existing home can be more affordable than selling your home and buying a new property. Likewise, buying an affordably priced ‘renovator’s delight’ to refurbish can be financially rewarding and emotionally satisfying.
It’s important to remember that home improvement projects often run over budget. Seek the advice of a licensed builder or architect about potential costs before doing anything, and don’t forget to speak to your local real estate agent to ensure you don’t overcapitalise.
‘Overcapitalising’ is what happens when a property is improved over its resale value. This is what could happen if you spend more money on renovations than those renovations add to the property value. For example, you spend $150,000 on renovations. When you come to sell the property, you find the improvements have added only $100,000 to the property’s value. You would have overcapitalised by $50,000.here are several advantages in building from scratch.

You can customise your home to your own tastes and needs, ensure it has higher levels of sustainability and energy efficiency than older homes offer, and lower maintenance costs. Plus, you have the protection of a new home warranty. On the flip side, building can be a drawn-out and stressful process, and can come with hidden costs and greater levels of uncertainty. You’ll also need to navigate the multiple relationships and costs involved with employing an architect, draftsperson or project home developer, the builder and tradespeople.

You need a Mortgage Broker like Alex, to answer all of these questions and support you through the process of home renovation and correctly funding your home improvements.

To get the RIGHT lending advice for your situation, please contact Alex McAllum on 0435 725 410 or email Alex HERE:  Book a Meeting with Alex here

Click here for your Free Guide to getting your finances sorted for Home Improvement and Renovation Loans 

Finding the right finance options for your dream home renovations

Understanding how you’re going to fund your home renovation is just as important as deciding on the design and fittings you’d like. It’s possible to fund minor home improvements through cash savings and/or a personal loan, but if you’re planning a major project, you could also consider using your home loan as a source of finance.
Redraw
If you’re ahead on your home loan repayments and your loan offers a redraw facility, you could withdraw any extra repayments you’ve made. This is a low-cost option, but you’ll be limited to the value of additional payments made in the past, which may not be enough to cover your renovation costs.
Loan top-up
If you’re happy with your current loan and lender, a loan top-up can be a simple way to access extra funds. This could involve taking your loan back to its original level or adding a bit extra.
While topping up your existing loan may involve less paperwork than refinancing to a new loan, your lender could ask for a new valuation of the property. This will usually be based on the property as it stands, and the impact of your planned renovations may not be taken into account.
Bear in mind that topping up your loan will mean higher loan repayments, so you should be careful to calculate whether this is affordable for you.
Loan refinance
It’s worth considering a new loan that could offer a better rate or improved features. A major renovation can be the cue to consider refinancing. If you’ve owned your home for some time, you may have built up considerable equity in it. A loan refinance can be a great way to access this equity as a source of low-cost funds for your renovation.

Tip: Make sure you have all the facts
It’s common for unexpected expenses to come up when building or renovating. Your building contract should offer a fixed price, but it’s worth speaking with your mortgage broker and lender to see whether you can vary the loan amount if costs change unexpectedly. Otherwise, these costs may need to be paid from your own funds.

You need a Mortgage Broker like Alex, to answer all of these questions and support you through the process of home renovation and correctly funding your home improvements. 

To get the RIGHT lending advice for your situation, please contact Alex McAllum on 0435 725 410 or email Alex HERE:  Book a Meeting with Alex here

 

Alex can also assist you with:

• Mortgage Broker in Mount Barker
• Mortgage Broker in Strathalbyn
• Mortgage Broker in Littlehampton
• First home buyers
• DHOAS loans
• Construction Loans
• Home Loan Refinancing