Hi BP Forum,
My wife and I want to renovate our kitchen in a few years and I'm trying to plan how to pay for it.
I think the easiest plan would be to take out a Home Equity Loan but then I'm going back into debt and not investing
Would anyone on BP plan to use Home Equity for renovating their own house or would you plan to pay in cash?
Thank you in advance and I very much welcome any comments.
This is not an answer, but I've been living in rehabs for years, because I just can't stand the thought of spending my cash to make myself more comfortable, when I could use that same money to buy another house - lol.
Of course, that won't fly when you have a family.
And I do say, that I'm damn sick of sleeping on a mattress on the floor ;-)
There are so many variables to this situation that it's difficult to answer. We have no idea how much you make, how much your renovation will cost or what kind of renovation you are doing. That said, my general rules of thumb is that if I pull money out of a HELOC for my own property, I need:
-100% return on equity, so the upgrades must be desperately needed, done well and inexpensively
-I should be able to pay it off within a year.
I don't want my equity tied up for so long that it stifles my ability to grow my portfolio.
Try the old fashioned way to pay for it . Work a bit more and save some money .
I would save up for it and do the renovations when I have enough money to pay for it. Otherwise just deal with the kitchen as is unless an appliance breaks and then just replace the broken appliance.
How much cash can you save a month? If you can save $200 a month, in three years you would have $15k available for a kitchen renovation.
If you watch the sales at Lowe’s/ Home Depot, you can purchase stock cabinets pretty inexpensively as well as the countertops.
I was able to renovate my kitchen doing this for about $12k. Most of that was on the appliances.
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