Renovating Your Home

It all started with an innocent conversation I had with my husband. Here's a little background information. I work entirely from home and my husband works here a great deal of time. We had our computers in a corner of the basement, which also served as a family room. "Wouldn't it be nice," I said one day, "if we could work in an area with a bit more light and fewer distractions" And he agreed. So, we began to think of where we could relocate our offices within our somewhat small home. I thought an enclosed porch in the front of the house would be nice, so we called a contractor, who struck down our idea, but recommended an architect who, he said, might have other suggestions. And so began our journey through a major home renovation.

Financial Matters

Without financial constraints, you could do as large a renovation as you want. You could even throw your house down and start all over, transforming your home into the one of your dreams. However most of us do have to work within a budget. It's much easier to determine how much money you can spend before you determine the extent of the project you want to do. That's far less disappointing than meeting with an architect and coming up with a plan you love, only to find out you can't afford it.

You may choose to use money from your savings, or, as many people do, take out a loan. Depending on the amount of money you want to borrow, and the equity you have built up in your home, you will choose either a home equity or a home improvement loan. You will need to determine how much money the bank will let you borrow and how large a loan you can afford. Since you will be making monthly payments, you must determine how those payments will fit into your household budget. Here's a list of local banks that offer home loans, as well as some calculators that will help you figure out how much you can borrow, and what your monthly payments will be:

Banks

Bank of New York
Washington Mutual
Bank of America

Calculators

How Much Will My Payments Be?
How Much Can I Borrow?

Estimating the Cost of Your Project

Now that you know how much money you have available, you'll need to know how much your project will cost. Obviously if you need more money than you have available, you'll need to trim down the scope of your project, or put it off until you can more easily afford it.

Before you go through the expense of bringing in an architect to draw up plans, you might want to do a rough estimate of how much your desired project will cost. Keep in mind that work you do to your house is an investment that will have an impact on your home's resale value. However, if you simply can't afford it at the moment, the impact on your home's future value won't really matter.

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