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Home Renovation Options

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Combining Finances with Your Partner

May 15, 2022

As we continue to see low housing inventory and higher interest rates for new home mortgages, many homeowners are opting to stay in their homes and deciding to live out their HGTV dreams by embarking on that much needed or just wanted home remodel or renovation. Often times, many clients wonder what their options are for funding a new finished basement, master bathroom, extra home addition, or private backyard of their dreams but are unaware of all of their options. Below are a few strategies to consider when outlining your finance options for your projects:

  • Save and use cash/non-retirement investments

o Pro: No debt once the project is finished!

o Con: Can take longer to save and if assets are used, this may reduce liquidity of assets.

  • Apply for a Home Equity Line of Credit (HELOC)

o Pro: Only pay interest when the HELOC has a balance.

o Con: Some HELOCs are variable which can be risk with interest rates rising.

  • Do a cash out refinance

o Pro: Fixed rates are common and more advantageous than a HELOC.

o Con: Sometimes, lenders require that the primary mortgage is part of the full refinance.

  • Explore a Security Based Line of Credit attached to a brokerage account (this is different than Margin)

o Pro: Money stays invested in the market, while having an option to choose either a fixed or variable interest loan term

o Con: In some cases, if the account value goes below a certain amount, the lender requires the balance to be "called" which in the most simple terms, adding more money to the brokerage account so that it suffices to keep the loan viable.

By no means is this an end all or be all list, there are many other financing options for home renovation projects, but it would be wise to explore and consider a combination of many of these options before undertaking a large home project!

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About the author

Cristina Briboneria

Cristina Briboneria

Vice President, Private CFO®

Cristina Briboneria, CFP®, ADPA®, AWMA®, Vice President, Private CFO®.

Cristina is originally from Los Angeles, California but has lived in Houston, TX, Cleveland, Ohio, and now resides in Atlanta, Ga. Cristina graduated from Oberlin College with degrees in Mathematics and History. She earned her Certified Financial Planner(TM) designation from Oglethorpe University.Cristina has also been recognized in Atlanta Magazine as one of Atlanta's Five Star Wealth Managers.

Cristina joined Ameriprise Financial in 2005 and was one of the Top 10 Advisors in her peergroup at the end of her first year. She was rewarded the Mercury Award, Centurion Award, and First Year Top Achiever Award for high achievement. She quickly moved into leadership positions as an Advisor Coach and District Manager in 2006. As a District Manager she earned the Circle of Success award when she lead her team to Top Five in the country throughout the entire company.

Since joining oXYGen, Cristina has built a successful practice of over 175 clients having awide range of demographic from business owners, corporate executives and employees, teachers, clergy, and non-profit organizations. She wanted to help build a company that was tailored specifically towards Gen X & Y."These generations have been overlooked and will be a driving force in our future economy. They will be a force to be reckoned with--many of of my clients are purpose driven individuals wanting to make a difference in their places of business but also wanting the knowledge of how to be financially responsible and successful."

Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. oXYGen Financial is not affiliated with Kestra IS or Kestra AS. Kestra IS and Kestra AS do not provide tax or legal advice. Investor Disclosures: https://bit.ly/KF-Disclosures

The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra Investment Services, LLC or Kestra Advisory Services, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual. It is suggested that you consult your financial professional, attorney, or tax advisor with regard to your individual situation.

Background and qualification information is available at FINRA's BrokerCheck website.

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Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. oXYGen Financial is not affiliated with Kestra IS or Kestra AS. Kestra IS and Kestra AS do not provide tax or legal advice. https://Bit.ly/KF-Disclosures

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