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Every family's position about debt is different.

They will answer the following questions very differently: Do we believe there is good debt and bad debt? Should we refinance our home to pay for the changes? Should we save up and pay in cash? These are the questions that a couple must talk through. They will affect the scope, timing, and legacy of a renovation project. Getting clear on how you secure financing is a critical step before the contractor shows up.

There are several ways to pay for a home renovation. 

1. Pay With Cash

Ideally, you pay for the renovation with money you already have saved. Saving up for a renovation project brings a couple together as it gives a couple a common goal to work towards.

Paying for the transformation of a home with cash gives homeowners an undeniable sense of satisfaction that they have accomplished a dream together. That's ideal. But it's not everyone's story.

Some couples use the equity they have made on their home and cash in early either to enjoy the home more or to increase its resale value. 

2. Refinancing Your Mortgage

You can talk to your mortgage broker about refinancing your mortgage. Adding a little more to your mortgage payment is one way to take care of a renovation that needs to be done right away. While you will be paying a little more in interest over time, it is much less painful of a hit when it gets paid off over several years. 

3. Line of Credit

You could consult your bank about opening up a line of credit. This method of financing your project will give you a much lower interest rate than paying with your credit card.

The Worst Way To Pay For A Project

What we never recommend is paying for your renovation project with your credit card.

While the rewards points may be tempting, the interest rates are high and often hard to pay off. It is wise to look for rebates that become available from various environmental initiatives if you are increasing efficiency.

Your contractor should know what's convenient for you.It pays to be patient. You are saving money in the long term.