Home improvement is an important way to increase the value of your home. It includes repairs, upgrades, and additions. Typically, the work is tax deductible. However, homeowners must follow the proper procedures to ensure the project is completed correctly.
Home improvements require that homeowners hire a contractor. In order to find a good contractor, you should research the local area. Ask neighbors and friends for suggestions and references. If possible, get a quote from several contractors before choosing one. You can then compare prices and schedules to find the best fit for your needs.
The first step to starting a home renovation project is to make a list of everything that needs to be done. This list will help you negotiate with your contractor and to lock in firm prices. Keeping a detailed list of all the items you need to buy and hire will also allow you to be aware of any safety hazards.
When hiring a contractor, you should check to ensure they have the necessary licenses and insurance. Make sure your project will be covered by any inspections or permits required by your city or county. Also, you should request references from former customers to make sure the contractor is worth your money.
You should always get a written contract outlining your home improvement project, including the scope of the work, the payment plan, and the expected timeline. A well-planned budget will allow you to avoid overspending and ensure your renovations are completed properly.
Most states have regulations that govern home improvements. Your local department of consumer affairs should have information on these requirements. They can also be searched online. To be sure that you are doing business with a licensed contractor, search for a company with a “license to operate” and a solid Better Business Bureau rating.
Depending on the type of home improvement project you are planning, you may be able to use a credit card or line of credit to pay for the work. You can also refinance your mortgage to give you additional funds for your renovations.
Another option is to obtain a home equity loan. Using a home equity line of credit allows you to use the line of credit as needed, allowing you to pay for your renovations over time. With a low interest rate, this is a more attractive option than paying for your renovations with your credit cards.
Before beginning a home improvement project, be sure to check with your CPA and your mortgage lender. These individuals can advise you on whether your home improvement projects are considered repair, maintenance, or a capital improvement. Whether you choose to perform the work yourself or hire a contractor, you will need a license and a written contract to ensure you do business legally.
In some states, such as New York, you can be fined if you engage in “home improvement” without a license. These fines vary, but they can be as high as $500 per day. Moreover, the Attorney General has the authority to file charges and sue contractors to recoup reasonable attorney fees if they violate the laws regulating home improvements.