Over the past year, the home has become the office, the classroom, the gym, and our safe place. After spending so much time at home, many homeowners wonder, have I fallen out of love with my home? Does my family need more space, or do we need to do more with what we have? Home inventory is low right now. Houses are spending almost no time on the market before the highest bidder snatches them up, so before you think about selling, be sure you can get a new home that you will love to replace your current home.
In this 5 part series we will highlight the top 5 renovations of 2020.
Part 3: Flip Guest Room
The guest room may be the most irking and/or most controversial room in the house. For one, it can be hard to style, and you may want to use it as a multi-purpose room. But how do you start? Or where do you find inspiration? Knowing the purpose of your room will help with your renovation or makeover journey. If you want to store a bed or have office space or even a workout area, drawing out and visualizing your plan will make it easier for you to know your space’s capacity and help with budgeting. For some great tips to save space and money, check out the videos below.
Office + Guest Room:
If your final decision is to give your home one last chance before you end it, you will need to find a way to pay for these renovations. A great way to do this is to get the money from your home by doing a cash-out refinance. A cash-out refinance is a type of mortgage refinance that uses the equity you have built over time and gives you cash in exchange for taking on a larger mortgage. You borrower more money than you owe and take the cash to use for a project of your choice.
Mortgage lenders set the requirements regarding who qualifies for a refinance. Things they consider include:
- Credit Score-your credit score needs to be at least 620
- Debt to income ratio – you generally need a DTI ratio of 43% or less
- Equity in your home-you need at least 20% equity in your home
- Appraisal – you will need a recent appraisal of your home to assess its current condition
With rates at historic lows, if you have equity in your home, you can borrow money at a much lower interest rate than you would pay if you used a credit card or financed renovations through a retailer. If you are ready to start your home makeover today, contact one of our mortgage loan officers today to learn more.
All posts in this series:
- Part 1: The Gym
- Part 2: The Kitchen
- Part 3: The Guestroom
- Part 4: The Art Studio
- Part 5: The Home Theatre