It’s a rare homeowner who is completely satisfied with their whole house – who doesn’t have at least some small corner that they would like to renovate or redecorate?! Renovations can be costly though: with the average kitchen remodel costing over $20,000, it can be difficult to budget for and raise the cash – especially if it’s a large-scale project, or if you’d like to extend the square footage. With a little creative thinking, your home could help you to raise the money you need to make the changes you want.
Making Use Of Extra Space
Have you got an extra room in your house that you don’t currently make much use of? More and more people are making extra money from their home using sites like AirBNB, which allows them to rent out all or part of their home on an ad hoc basis. If you like the idea of generating cash from a spare room but would prefer not to have different people coming and going then you might want to consider a more long-term arrangement like sub-letting a room. Obviously, there are pros and cons to both: you will have to get used to having other people in your home – but you can control who you accept bookings or lettings from, and you can set the boundaries.
If you’d like some extra company then you could create a communal area, but if you’ve got young kids then you might prefer to have a separate entrance in order to maintain some sense of privacy and security. One thing to watch out for is to make sure you check the fine print of your mortgage and home insurance to ensure you are not invalidating any clauses – the last thing you want is someone to damage your home and not be covered for repairs, or for it to affect any future home financing.
Mortgages, Remortgages and Reverse Mortgages
Mortgage rates have been historically low for the past decade, but with the current economic growth they are now starting to climb – so if you haven’t done so already, now could be a good time to remortgage and lock in at a lower rate. You may find that due to an increase in the value of your home, or a build-up of equity, you could release some of the value with a cash lump sum, or just reduce your monthly payments – freeing up some cash. Some lenders are also willing to give you a construction loan – where they’ll release extra funds specifically for remodels or extensions, based on what your home will be worth at the end. If you want to put an end to monthly mortgage payments altogether though, you may want to consider a reverse mortgage – where the lender pays you a monthly amount for your house, in exchange for a percentage of the equity in it. Reverse mortgages are often popular with older people and those with no dependents, as you receive a guaranteed right to live there and there is no requirement to pay the loan back until the house is sold.
Do What’s Best For You
As with so many things in life, what is right for one person won’t be the best thing for another. Consider your specific circumstances and what will be right for you, whether that’s making use of extra space in your home, or looking at how you finance your mortgage. If you are unsure what is right for you then consult an independent financial adviser and consider all your options carefully before jumping in. That way, you’ll have the peace of mind that you’re doing the right thing – while thinking about how you’re going to use those extra dollars.