Not Sure Which Method Is Best to Fund Your Home Improvement Projects? Take a Peek Here!

As soon as the month of October ends,  most senior homeowners quickly shift gears to focus on the upcoming family-oriented holidays, the winter season, and unfortunately, how to pay for home improvements. Travel costs, gift shopping, and preparing for unexpected winter expenses can make one feel anxious and completely overwhelmed.

Although there are several ways to finance all these expenses, especially home improvement, senior homeowners must ultimately choose the most beneficial option for them. At the end of the end of the day, no one wants to be still paying for home improvements long after the shine and excitement have worn off.  According to Casey Fleming, author and mortgage professional, “the biggest mistake that people make is that they finance their home improvements for a longer time than the improvements will last.”

Here are a few options that one can look into for funding major home improvements:

  1. Cash – It is the easiest way to cover the costs of home improvement. You would not have to worry about future payments, and it is always more financially sensible to wait. If you can manage to complete one project at a time, starting with safety improvements first, this would be a good However, this may not be feasible when living on a fixed income.

 

  1. Credit Cards – Using your credit card would allow you to cover a smaller renovation, or at least purchase the materials needed. However, one has to consider interest rates and the overall maximum limit carefully.

 

  1. Borrowing from 401(k) – The truth is that most 401k programs allow an individual to borrow from their account and pay back the loan over five years via payroll deduction. Although you pay interest to yourself, the balance would be due immediately when you complete the job.

 

  1. Contractor Financing – Some contractors do have relationships with finance companies and will offer ways to help arrange to fund the project, but it is typically not the best idea. Also, it is more expensive in the long run.

 

  1. Reverse Mortgage – If a homeowner is 62 or older, a Reverse Mortgage is an excellent option. It is based on the percentage of equity in the home and is a loan. The loan is only due back when the homeowner dies or no longer lives in the house. The cash is tax-free and could be immediately used to fund all home improvement projects.

 

With a Reverse Mortgage, you can choose to do one or all projects with tax-free money. Reverse Mortgage Answers has successfully helped thousands of senior clients with this federally-insured loan. Our professionals have a passion for assisting senior homeowners and giving them the facts about the Reverse Mortgage.  Call Reverse Mortgage Answers with any questions at 1-800-420-5515.

 

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