How to Determine Your Home Remodeling Budget
Determining your home remodeling budget is one of the first steps in the home renovation process. Finding a good lender, amassing your cash and determining the cost of your remodel can take time. The following steps will help.
Estimate the Remodeling Costs
One of the most difficult parts of planning for a remodel is estimating the costs. Most homeowners don't know the price of materials, how much to expect to pay in labor or what unexpected costs will be incurred through the project.
At this phase, it's good to have help from an industry expert. Contact a few reputable contractors from your community. Talking to a contractor can help you grasp the scope of your project: approximately how many man-hours the project will take and what will need to be done to your home. Your contractor can also give you a list of materials that will need to be purchased with estimates. Don't forget to add about 10-20% to the bid from each contractor, to account for unexpected issues and changes during construction.
Scrape Together the Cash
Once you have a bid from a contractor that you want to work with and a rough idea of the remodeling costs, then it's time to get together the money for your project. If you have cash on hand, then this part is relatively straightforward. However, many homeowners must borrow in order to make home improvements. Check with many lenders, including banks, credit unions and mortgage lenders, before deciding on a loan.
The borrowing process can take time, especially for homeowners who hope to get the best deal with the lowest interest rates. Shopping around can result in good deals. Before approaching lenders, it helps to get your paperwork in order. Check your credit report for errors and look at your credit score. If you find errors on your credit report, get them corrected before approaching lenders.
Once you've talked to several lenders, you'll know approximately how much you can expect to borrow for your home remodeling project.
Set Your Priorities
Sometimes it happens that homeowners realize after meeting with a contractor and approaching banks that they need to scale back their expectations for their remodel. When this happens, you'll need prioritize. In the world of remodeling, there are many ways to save money. Some of the biggest costs include:
- Knocking down walls and expanding spaces.
- Moving plumbing fixtures.
- Installing high-end appliances.
Assuming that your contractor gave you an itemized estimate, you'll be able to see for yourself what's costing the most money for your remodel. If you're having a hard time deciding where to trim the fat, work with your contractor to reduce the prices.
Contact Litchfield Builders
At Litchfield Builders, we work with homeowners as they navigate the complicated waters of home remodeling. Whether you're remodeling on a budget or embarking on a dream remodel, we'll be happy to help you on the renovation journey. Contact us today to get started.