Doing a Home Improvement Project Yourself-Yes or No?

After you have defined your home improvement project, the thought of doing the project by yourself or with a “HANDY” friend or neighbor may cross your mind. DO-IT-YOURSELF projects are a popular trend in the Home Improvement Industry. However, before you put on your tool belt, you should look at all aspects of your project and ask yourself the following 10 questions.

1) Do you have reliable work habits? Do you tend to stress out easily, lose your temper, or become confused under pressure?  Will you have the patience and persistence to complete the project in a timely fashion? What will happen if it is not completed in a timely fashion? 
2) What will you do if your project goes awry? Remember most contractors are wary about completing and/or redoing someone else's mistakes, including yours. 
3) Are you attempting to do the project yourself for financial reasons? If so, have you looked at the entire cost, including the cost of materials, your time, and the tools you may need to purchase, and then possibly never use again? 
4) What happens if you make a mistake and have to spend more time and effort to correct it? How much money are you really going to save then? 
5) Do you know all the construction steps involved in the project? For most projects this is not the time to be using an installation manual. 
6) How many projects of this type have you done? I hope at least 1 project.        
7) Do you have the skills to complete this project? For most projects this is not the time for on-the-job training.  
8) Is it safe for you to do the project? Some projects can cause serious injury or be fatal if proper precautions are not taken. 
9) Are you familiar with the local building codes and permit requirements? If you do not follow the building code you may be forced to tear down the project and rebuild it to meet the proper code specifications. 
10) Do you have the time to do the project?

If your answers to these 10 questions still leave you feeling comfortable about doing your project, than I would say go ahead! However, if time is of the essence, it normally takes a “Do-it-yourself” project longer to complete because most people are not familiar with all the “nuances” that one would learn from doing the project more than once. Think long and hard about doing a project yourself, especially if it is a large project. Large projects require more time and effort and are usually best left to a professional.

Home Improvement Loans – 7 Tips You Should Consider When Getting Home Improvement Loans

From time to time it becomes necessary to acquire home improvement loans to help you “upgrade” your house. Whether you are renting the house out to tenants or you live in the house yourself, home improvements always add value to the property.

There are many home improvement loans you may decide to go after depending on your circumstances such as your credit score and the amount of down payment you may have. You also need to check on other requirements of the type of loan. Here are 7 practical steps you can take to get a home improvement loan approved.

1. Know How Much Money You Need to Get from Lenders.

Determine which areas of the house need improvements. Get contractors to give you an estimate of what needs to be done and how much it will cost to have them done. This will give you a rough idea of how much you need to borrow.

2. Documentation.

Put all the needed documents that lenders require together. These usually include tax returns, prove of employment, income in the form of bank statements and other data such as your debt-to-income ratio.

3. Know Credit Rating.

You are entitled to a free credit report from the credit reference agencies each year. So request a copy of your report. Go through carefully and if you see any mistakes, file a dispute with the appropriate agency to have the mistake removed. This would improve your credit score.

4. Look for Appropriate Lenders

Look for reputable lenders to borrow from. Know the average interest rates and the rates at which you are being offered the loan. Stay away from lenders whose credibility you cannot establish. If their offer is too good to be true, they probably are. If you make your application online, protect yourself against identity theft.

5. Home equity loan or home equity line of credit?

Each of these are somewhat like a second mortgage. Which one you go for is entirely up to you. A home equity loan is a lump sum of money with a fixed interest rate. It is based on the equity of the home you want to make improvements to. On the other hand, a home equity line of credit has a variable interest rate based on the principal (i.e. loan amount). A home equity line of credit is similar to a credit card, where you pay interest on the amount of money you take from the line of credit, calculated every thirty days. Talk to your banker if you do not understand any of these fully.

6. Understand Everything Before You Sign.

Unfortunately, many people never read the fine print because it is time consuming and boring to read. However, the little time you spend reading the terms of service of the lender is nothing compared to the money you will have to pay if you did not understand something and signed anyway.

7. Create a Budget.

Getting a home improvement loan means you are getting a second mortgage on your house. If you default you stand to lose your home. So create a budget to ensure you make your payments on time without any defaults. It will let you know how much money you can afford to put towards making repayments.

These are some of the best steps you need to consider when you are preparing to get a home loan meant to help yo improve you house.

Home Improvement – The Top 10 Home Improvement Mistakes And How To Avoid Them

Although a major home improvement can prove to be a rewarding project, it can also turn your life upside down if you are not prepared. I’ve heard of some worst case scenarios involving people who have lost their homes because they got in over their heads and others who ended up with incomplete project nightmares that cost them thousands of dollars to correct.

Following is a list of the top ten mistakes homeowners make when undertaking home improvement projects and tips on how to avoid them:

1. References. Do enough research and background checking to satisfy you. Walk away if the contractor is not willing to provide references from former clients. Do an online search of the contractor’s business and personal name. Check with local courts for judgments filed against them and with the Better Business Bureau for any consumer complaints. Look at previous work completed (in person). Check with material suppliers since a good contractor will have a long-standing relationship with suppliers. Contact other contractors who have worked with them before. Check their credit standing – contractors with bad credit are often disorganized and don’t manage their business well. Inquire about insurance, workers compensation and licensing.

2. Project management. You need one person to help you manage your project. Most issues occur when inexperienced homeowners try to manage their own project. A project manager is a single point of contact between the homeowner and other contractors and is responsible for scheduling and workflow.

3. Contracts. Make sure your contract is solid. As obvious as this may sound, failure to get a contract or signing an incomplete contract is one of the most common mistakes. Put all the details in writing – never take someone’s word for it. Following are items that should be included in the contract: (1) the full name of the company and the person you are doing business with and their contact information, (2) an addendum consisting of the complete set of plans, (3) an addendum consisting of the materials to be used, (4) the price of the goods or services, (5) the manner and terms of payment, (6) a description of the work to be performed, (7) a start date and an estimated completion date, (8) a default clause in the event either party defaults that specifies how damages will be calculated, (9) warranties and (10) signatures.

4. Warranties. Make sure you receive a warranty with detailed terms and conditions. Don’t accept a contract that simply states that all work is guaranteed. There is often confusion as to who is responsible for the warranty. Get the following in writing: (1) Who is backing the warranty? (2) What is covered and what is not covered? (3) How long is the warranty valid for? (4) What can void the warranty? (5) What is the process for placing a warranty claim?

5. Changes. During the project, you may change your mind on certain design aspects which may require more or less work from contractors. It is critical to document every change order and note the exact cost or savings. Changes should be signed and dated by all parties.

6. Plans. Get a clear description on what will be done, how it will be done and the materials to be used. For smaller projects, contractors can draw up plans. For larger and more complicated projects, find a qualified designer or architect. And, for example, if load-bearing walls will be altered, find an engineer to review the structural side of the plans.

7. Costs. Estimating costs tends to be a big problem because people do not make realistic comparisons. Homeowners may hire the contractor with the lowest price but that price may turn out to be much higher in the end. “Allowance items” tend to be the main culprit in estimating costs. For example, contractors may give you allowances for flooring, lighting or hardware that are artificially low. The bid looks enticing until you examine it closely. Request a line item for straight costs on materials and labor since some contractors mark up materials and labor so they can make a profit on it. Ask the contractor to pass along costs to you and to add a line item for their fee. This creates a more clear and honest assessment of the job.

8. Financing and payments. Before signing the contract, figure out how you are going to pay for your home improvement project. Make sure you maintain control of the money – don’t let your project manager or contractor control the money. This sounds obvious but many homeowners allow contractors to make draws on construction accounts only to realize that the draws were not used for the intended purpose. What does this mean? It means your contractor scored a new truck, you’re out of money and the project is incomplete. Tips: (1) don’t pay a lot of money up front, (2) pay when materials are delivered, (3) pay when work begins and (4) pay as work progresses. Pay only after work and materials are inspected and approved.

9. Inspections. Don’t wait until your home improvement project is almost complete to do the inspection. Plan phased inspections along the way so work doesn’t need to be re-done. Don’t rely on city and county building inspectors to protect you since the codes they enforce don’t guarantee quality (and they often miss things too!). Before paying for work, hire an independent inspector to do periodic phase inspections.

10. Materials. Stick with products that are tried and true. This rule especially holds true when it comes to windows, doors, framing materials, roofing products, concrete coverings, epoxy floors, plumbing, light fixtures and electronics. You don’t want to be the guinea pig that test runs the supposed latest and greatest new products or materials only to find out that these items don’t last or turn out to be fire hazards!