If you/dh received a large bonus...

[ma23peas]

Are you saying you remodeled four rooms and a bathroom or are you saying you added an additional 4 rooms and a bathroom for $40K?

 

Dawn

 

YES! But the difference was I did it all under the same roof...our house was built with room for a full upstairs, the previous owners only finished out 1/4 of it. My cousin was a master carpenter, i drew up the architectural plans ( i used graph paper and created a scaled drawing of specs and dimensions)...I purchased and helped haul all the lumber through an upstairs window!

Materials (electrical wiring for all new areas, insulation (blown), lumber, 3/4inch subflooring that went on top of the quarter inch subfloor, tile (did all tile work myself), grout, all new lighting fixtures, paint (painted every room except hired someone to do new ceilings), drywall, outlets, appliances, custom cabinets for kitchen, quartz countertops, tub, all new toilets, sinks, molding, doors, wood floors, carpet, HVAC unit) 30k

Labor (carpenter, plumber, electrician, wood floor install and sanding (i stained and finished first coat)) 6k

Pulling my own permits for inspection...around $500...we are lucky to live in a cheap county...

I kept to a strict budget, found incredible deals on appliances and great cabinet maker who only charged 8k for all my kitchen...top notch and Lowes and other kitchen centers wanted 20k for the same kitchen! It can be done, but I did not get a lot of homeschooling done those 3 months! But the kids learned a lot about hands on work!

[DawnM]

Ah, I see. It does cost far less if you aren't actually adding additions.

 

We are finishing our 980 square foot basement right now that was unfinished when we moved in.

 

Dh is doing all the work himself.

 

Dawn

 

YES! But the difference was I did it all under the same roof...our house was built with room for a full upstairs, the previous owners only finished out 1/4 of it. My cousin was a master carpenter, i drew up the architectural plans ( i used graph paper and created a scaled drawing of specs and dimensions)...I purchased and helped haul all the lumber through an upstairs window!

Materials (electrical wiring for all new areas, insulation (blown), lumber, 3/4inch subflooring that went on top of the quarter inch subfloor, tile (did all tile work myself), grout, all new lighting fixtures, paint (painted every room except hired someone to do new ceilings), drywall, outlets, appliances, custom cabinets for kitchen, quartz countertops, tub, all new toilets, sinks, molding, doors, wood floors, carpet, HVAC unit) 30k

Labor (carpenter, plumber, electrician, wood floor install and sanding (i stained and finished first coat)) 6k

Pulling my own permits for inspection...around $500...we are lucky to live in a cheap county...

I kept to a strict budget, found incredible deals on appliances and great cabinet maker who only charged 8k for all my kitchen...top notch and Lowes and other kitchen centers wanted 20k for the same kitchen! It can be done, but I did not get a lot of homeschooling done those 3 months! But the kids learned a lot about hands on work!

[justasque]

The previous owners of our house thought it would be a great idea to carpet everything, including bathrooms. So I get to enjoy decades of lingering pee smell in those nasty bathroom carpets. Next thing to fix on our remodel list.

 

Rip 'em out.

 

Pull up a corner of the carpet, see how it is stuck down, pull up what you can. Use the other end of a hammer or a screwdriver to pull staples - wear eye protection. Pull up a bit at a time. Get a box cutter, cut the carpet where needed. ANYONE can do this.

 

See what's underneath. Could be tile, could be plywood. If it's plywood, you can take that up and replace it too, but if this is too much for your remodeling talents, sand it a bit then paint it to seal it up.

 

If it's tile, and it's in good shape, clean it up and go with it. If it's not so good, you can rip that out too.

 

If you need to remove the toilet to get to the area around it, this is actually a really easy thing to do. You may in fact find that the stinky carpet is really due to needing a new toilet seal. This is EASY and CHEAP (definitely less than $20 and probably less than $7) and you can find a video on youtube to help you learn how. The idea is 1) remove carpet, 2) remove toilet, 3) apply floor finish, 4) replace toilet.

 

SO much better to have clean humble materials than stinky carpet.

 

What do you want to remodel, and why?

 

For example a bathroom remodel is a bit of a priory for us. This is because the previous owners where tall drunk men with very bad aim. You can smell it. If you are taking a bath it's best to use scented bath something and light a candle to mask the smell.

 

We will be remodeling the bathroom soon, .... I hope.

 

Again - check out where the smell is coming from. If it's in the drywall, it's a bigger job. But if it's the flooring, it's pretty easy and inexpensive to re-floor a small bathroom. And if the toilet wax seal hasn't been changed in years, that might actually be the root of the problem. YOU CAN DO IT!!!

[Cassy]

Nope! I'd invest it. Your house is probably worth a lot less than when you bought it. Any money you put into it could potentially be lost when you go to sell.

 

Soooooo....... call your bank and refinance. Get a lower rate to reduce your mortgage.

 

Then call your financial planner/investor and get your money into a fund that has a quarterly dividend.

 

I'm so glad we didn't pay down our mortgage. Instead of losing it all, we're losing some. Our home devalued $100,000. We thought that home was our final home, truly. Then DH's job was outsourced and the bubble popped.

 

This. We have enough in investments to pay off our mortgage if we needed to. We could also remodel if or when that became a priority. At the moment we hold our options open, and receive more back in interest than we would save if we paid off the mortgage.

 

Cassy

[Marylou]

Rip 'em out.

 

Pull up a corner of the carpet, see how it is stuck down, pull up what you can. Use the other end of a hammer or a screwdriver to pull staples - wear eye protection. Pull up a bit at a time. Get a box cutter, cut the carpet where needed. ANYONE can do this.

 

See what's underneath. Could be tile, could be plywood. If it's plywood, you can take that up and replace it too, but if this is too much for your remodeling talents, sand it a bit then paint it to seal it up.

 

If it's tile, and it's in good shape, clean it up and go with it. If it's not so good, you can rip that out too.

 

If you need to remove the toilet to get to the area around it, this is actually a really easy thing to do. You may in fact find that the stinky carpet is really due to needing a new toilet seal. This is EASY and CHEAP (definitely less than $20 and probably less than $7) and you can find a video on youtube to help you learn how. The idea is 1) remove carpet, 2) remove toilet, 3) apply floor finish, 4) replace toilet.

 

SO much better to have clean humble materials than stinky carpet.

 

 

 

Again - check out where the smell is coming from. If it's in the drywall, it's a bigger job. But if it's the flooring, it's pretty easy and inexpensive to re-floor a small bathroom. And if the toilet wax seal hasn't been changed in years, that might actually be the root of the problem. YOU CAN DO IT!!!

 

I was thinking the same thing! Thanks for saving me the typing!

 

Do what she said, and if you don't like the painted plywood look you should go get some of those self-stick floor tiles and put them down. ANYTHING is better than constant pee smell.

 

BTDT--why do people CARPET bathrooms?!?!?!?

[justasque]

Do what she said, and if you don't like the painted plywood look you should go get some of those self-stick floor tiles and put them down. ANYTHING is better than constant pee smell.

 

Self-stick tile for a small bathroom will cost in the $30-$60 range, and is very do-it-yourself-friendly. Give it a try - what do you have to lose?! Again, there are lots of videos on this stuff nowadays. Watch a whole bunch of them to get the idea and gain confidence, then go for it. Small bathrooms are a great place to get some DIY skills, because the area is small so the materials are inexpensive and the job isn't overwhelming. The higher-end self-stick tile is getting really nice nowadays.

[Sebastian (a lady)]

What about the fact that you lose the tax benefit if you pay off the nmortgage? Just saying THAT would be a huge consideration here.

 

We considered this when we decided to pay off our mortgage a couple years ago. Yes, we lost the deduction. On the other hand, we no longer have to pay the interest. We decided that for us, paying the mortgage meant paying out a lot to get a small tax benefit. Of course, this depends a lot of how your taxes are. We don't itemize, which may have made a difference.

 

On the other hand, our house is one we bought many years ago and the mortgage was for much less than it is currently assessed at. If our house had been bought at the top of the market and might have to be walked away from, it would be different.

 

It would also depend on what type of remodel work were considered. For example, I once convinced dh to buy a new dishwasher by pointing out that we were due to move in about a year. The old machine was horrible, with rust and missing front panel. We were going to have to replace it to sell or put in renters. So why not do it now and get a year's benefit of using the nicer dishwasher that we were going to have to buy in the end.

 

A kitchen remodel that involved new appliances could work similarly. It would allow you to spread out the cost of the appliances or to get a good deal by buying several at the same time. It might have cost benefits in energy savings.

 

Putting it into the mortgage would depend in part on if you could get the money back out when selling in your market.

 

I would also max out retirement funds before paying down the mortgage. Retirement funds don't count against assets for college financial aid calculations. And mortgage expenses are also taken into consideration. By my understanding, the money in retirement funds with a mortgage is counted as lower assets than the same amount of money used to pay off a mortgage without having retirement funds. Since college is only a few years away this is now a financial consideration to our choices.

[HiddenJewel]

I totally missed that the bonus would pay OFF the mortgage. I would do the mortgage first and then the remodel next time.

[LisaKinVA]

So many variables...

 

But, if everything was pretty equal (cosmetic issues, but nothing that really hindered living there... such as appliances all in good repair, flooring decent, no plumbing issues, etc.) I would probably pay off the mortgage, and wait on the remodel.

 

Then, I'd spend that time making remodel plans (consulting an architect, if needed, and finding out if there were going to be things that needed to be brought up to current code... getting bids, finding suppliers...watching when sales happen... to be in a position to take advantage of better pricing).

 

In many ways, remodeling can be more intense than building your own home from scratch, and many people skip the planning phase thinking it's not important -- when often times, it is MORE important.

 

Moving walls may entail moving electrical, plumbing, duct-work... opening walls means bringing exposed electrical and plumbing up to code. Replacing a heat/air unit may mean new duct-work throughout.

[Lisa in the UP of MI]

It depends on what the purpose of the remodel is. If it is to make the house more livable for your current family dynamic, the remodel makes more sense.

 

:iagree:

[photomo]

I say the mortgage after I make sure I have at least 4-6 months of salary in savings just in case of an emergency or just in case someone lost their job.

[kitten18]

Is your retirement adequately funded?

Are you saving what you want to for your kids college?

Do you have 6 months or a year of salary saved as an emergency fund?

How many years left on the mortgage? Towards the end of a mortgage, most payments go to principal and very little to interest. So you don't save that much interest by paying down. You save the most by prepaying at the beginning of the mortgage.

 

So if you have everything funded adequately (not completely funded, but an adequate level).

 

Will one year's bonus completely pay for the work or not?

 

I think I would put half in the bank for the remodeling and put half toward the mortgage. Then any time you have some extra money, add it to the fund. When you've built up enough to do the remodel, you can do it without guilt.

:iagree: IMO - all these questions need to be answered first.

[WIS0320]

:iagree:

 

While the bonus may indeed happen every year, it also may not - the opportunity to pay the mortgage off may disappear, so I'd do that first, then look at remodeling, since that's something that can be more easily put off if you don't have the debt of the mortgage.

 

We've always had the potential for bonuses as well and our income can swing 75k from year to year just based on the bonus. Some years you get 10k, others far more. We've never had no bonus but it could happen. My husband and I follow the old adage, "never count your chickens before they are hatched" and then we usually assume half the hatched chickens are going to die (a.k.a. unforeseen expenses).

 

I'm just saying I agree with everyone else that unless your income is fixed and his base salary is high, I would not, not, not count on a generous yearly bonus!

 

I'd probably refinance to a 15 year at 3.5% and invest a good chunk of the rest. Fund college for your kids, do a small remodel project, but diversify and save that money so it will grow long term. I know it is tempting to own a home outright but real estate has been shaky the last few years and I'd rather stick my money where I had a better chance of seeing growth.