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How to Make a Renovation Home Loan Work for You

You’ve had your home for a while but something isn’t right about it, and you need to fine tune sections of the house to perfection and also need Renovation home loan.

You may need to renovate because of a previously unseen design flaw, or your needs may change, in some cases external forces such as floods may force you to renovate, or it may be just a change in taste. Whatever the cause, renovations are costly, and you’ll have to part with more than what you would ordinarily spend without budgeting.

Most Australians are wary of borrowing against live home loans for renovation purposes.

However, a renovation home loan is an excellent option to finance your planned makeover. Going about it is easy. That is if you have the right partner to walk this journey with you.

Read on to find out more about how you can make a renovation home loan work for you.

What kind of Changes Do You Want?

Before you consider taking a renovation home loan, first evaluate the job at hand. Do you want to perform a cosmetic facelift such as redoing the paint job, retiling the floor and bathroom walls? Or replace some furniture and fixtures? Alternatively, the renovations could be more intrusive and would significantly alter the structure of your building. Do you intend to perform major renovation works such as replacing some external walls, modifying parts of the foundation, re-doing the plumbing and electrical works?

Cosmetic renovations don’t demand council approval and, on most occasions, will cost less than structural renovations. On the other hand, structural renovations are demanding. They require council approval and the engagement of professional tradesmen in the makeover. Structural renovations more costly and tedious than cosmetic renovations and in most cases would call for the need to seek a lender.

If you are still not sure whether your renovation job is cosmetic or structural, get in touch with our team, and they will guide you.

What’s Your Renovation Home Loan Budget?

Unlike when you were buying a house and had little say about the type of materials, quality of laborers and cost and complexity of designs, during renovations you can change all these variables to suit your liking.

You can bend and stretch your costs in line with what materials to use, designs to apply and labor to employ. The final figure spent on the renovation home loan largely depends on how elaborate your works will be.

To know how elaborate you are willing to be, start by asking yourself the following questions:

  • Do you want an elaborate job and employ only the most expensive materials, designs and technicians?
  • Do you want a job that uses standard materials and designs?
  • Do you want to renovate using only the most basic designs and materials?

Your answers to these questions as well as having a go on our loan calculator will help you come up with a figure slightly higher than the budget. This will inform you of the amount to apply. Just as a rule of thumb, do not use more than 10 percent of the property value on renovations.

Renovation Home Loans and Other Financing Options

Now that you have a picture of what kind of renovations you want. Also, you know how much you would like to sink into the job, consider your options for financing. Renovation home loans help you to improve the value of your home without the need to seek additional equity, and they come at fair rates. They are an excellent way to finance your renovation project. If you are working to put up standard or high-profile cosmetic changes or any structural change, you’ll get an opportunity to budget the for the project, work with professionals and get the right job done for the right figure. To get the best deal in renovation home loans, get in touch with our team.

On the other hand, if you are looking to make cosmetic changes and you just want to do a low profile job, you can opt for a line of credit home loan also known as equity loans.

To conclude, renovation home loans can help you transform the looks and value of your property. By considering the steps above, the value-add will surpass any additional interests that you will incur.