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Advice on Home Improvement Loans: Consider Home Remodeling Costs

By Nathaniel Hutchinson Business and Financial Expert


Typically, homeowners tap the equity in their houses to cover unmanageable debt; however, sometimes people secure second mortgages that act as home improvement loans to cover home remodeling costs. Unfortunately, many times, they leverage their property's equity to add aesthetic improvements that donít really add value to their home.

While some alterations can ultimately increase your homeís value, others really don't. Before considering a home improvement loan, understand which home remodeling projects actually increase the value of your property and provide even more equity in the long-term.

Ten home improvement projects that add value

1) Attic and basement - You can add significant value to your home by converting an attic into a bedroom. You can also add considerable value by changing your basement into an office or apartment.

2) Windows and doors - Energy efficient doors and windows can increase your home's worth; they can also lower your energy bills.

3) Bathroom and kitchen remodeling - Even minor improvements to the kitchen and bathroom can add thousands to the value of the house. New hardware and countertops are a good place to start.

4) Home additions - If done correctly, a home addition can really increase your homeís worth; however, be careful not to price your home out of the local real estate market.

5) Siding and deck - Adding new siding or a deck can improve the appearance of your home's exterior and add real value to the property.

Home improvement loan advice

Instead of taking out a loan to pay for remodeling projects that add little value to your property, consider a few relatively inexpensive home improvement ideas that will alter the appearance of your home without breaking the bank. If you simply must have change, paint a ceiling. If the floors are dingy and discolored, apply a decorative concrete coating. Whatever you do, weigh the costs against the possibility of gaining home equity, or you could end up incurring new debt without any hope of adding value to your house.

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