Most home renovation projects are done in the spring and summer, and we have some helpful advice on how to pay for them!

Summer is here, and you might be noticing some things you would like done around the house. From simply painting the living room a new color or building a porch to knocking out walls or updating a bathroom, there are endless possibilities for upgrading or remodeling your home. Here are four tips on financing your project!

1. Save up for it.

For smaller projects that you can do yourself, start planning and set aside money for it. Start the project once you have the amount needed for paint, lumber and supplies. Save a little more than what you plan on spending so that unexpected costs don’t put the project on hold.

2. Consider a home equity line of credit.

If you are planning a more extensive renovation, especially one that requires a contractor’s work, consider applying for a home equity line of credit.

These use the equity of your home as collateral. Equity is the difference between your home’s value and your current mortgage balance, and it’s what determines the loan amount you are eligible for.

With home equity lines of credit, you can take out what you need when you need it. This is beneficial if your project could span months.

3. Cash-out refinancing

Another option is a cash-out refinance. When interest rates are low, this can be more cost-effective than a home equity line of credit. With a cash-out refinance, you take out a new loan that replaces your previous mortgage. Because the new loan is larger than the first, you pocket the difference in cash. And, if you refinance when the interest rates are lower, your monthly rate could be even lower than it was with the original mortgage.

4. Consider a home equity loan.

FSNB loan officer Lisa Clark suggests that if you’re selling your house and purchasing a new one, you should consider a home equity loan instead of a conventional mortgage to be more cost-effective. “If your house is paid for, it can be cheaper to do a home equity loan on your existing home and to buy the new house with that,” she said. “Especially for people looking to downsize, odds are the house they’re selling is worth more than the house they’re buying. They can draw on a home equity loan to buy their new house, and then once the old house sells, everything is squared away!”

We believe in your plans!

If you decide that a home equity loan is the best way to finance a remodeling project, we would love to work with you!