Home improvement, otherwise known as home renovation or home remodeling, refers to projects that are undertaken to improve the look and feel of a home. They can range from improving the inside to the outside of the property. Depending on the scope of a project, homeowners may opt for government-issued loans or use credit cards to finance the project.
Tax-deductible home improvement deductions
There are several types of home improvements you can write off on your taxes. These include making your house handicap accessible, including widening doorways for wheelchair access, lowering cabinets, adding a walk-in shower, and installing elevators. You may be able to deduct the full cost of the improvements if you itemize your deductions. Some of these improvements also increase the value of your home, which is another tax deduction.
To claim home improvement deductions, you must provide financial records indicating the expense. These records may include invoices, contracts, and bank statements.
Government-issued loans
Government-issued loans for home improvement are a great way to fund your renovation plans without having to worry about your credit score. These loans come with varying terms and requirements. For example, a personal loan may be for five years, while a home equity loan can take decades. Moreover, the maximum loan amount varies from lender to lender. Some have strict requirements for loan applications, while others impose restrictions on the type of work to be done.
HUD loans may not be used for luxury items, such as outdoor fireplaces or solar panels. However, the improvements must be practical and will improve the livability of the property. Applicants must also submit a work proposal to support their claim for the loan.
Credit cards
Home improvement credit cards can help you pay for materials, contractors, and other expenses. You can make payments using the card and receive a statement each month. It’s best to pay the full balance on time to avoid paying interest. Many home improvement credit cards offer 0% introductory interest rates for six to 18 months. If you plan to spend a lot of money on your project, make sure to pay off the balance prior to the end of the introductory period.
Home improvement credit cards may be offered by store chains such as Lowe’s, Home Depot, IKEA, Walmart, and others. While store cards are not the best option for large projects involving contractors, you may find them useful for small projects. Some of them offer bonus rewards for purchasing items at home improvement stores.
Negotiating with contractors
When negotiating with contractors, it is important to understand how change orders and materials will affect your final bill. Often, materials and labor make up the bulk of your bill. You can save money by purchasing materials yourself or by paying subcontractors directly. Since most contractors will purchase their own materials and supplies, you may only need to pay for the materials and labor that the contractor uses. However, be sure to double check the quantities and prices with the contractor to ensure you are getting a fair price.
Before negotiating with contractors, determine your budget in advance. You will know best how much you can spend, and knowing your budget will help you prioritize tasks and negotiate a fair price.