Homefix is important but how to finance it is also important

Protect Your Housing Investment with Homefix

Your home is an investment in living as well as in savings. If neglected, it will pay no dividends. If properly maintained and improved, it will pay a high yield in comfort and usefulness for your family and in avoidance of costly repair bills. Home improvements also tend to raise neighborhood standards and, as a result, property values.

From an economic standpoint, homefix mean higher employment, increased markets for materials and home products-and therefore a more flourishing community.

If You Do It Yourself

If you are handy with tools and have the experience, you can save money by doing many jobs yourself. But unless you are skilled in wiring, plumbing, installing aircon systems, and hacking walls, you should rely on professionals for such work.

When you buy the required materials, it pays not to skimp. Good materials are not necessarily the most expensive. What you need are products that look good, are easy to maintain, and last a long time. Buy only from reliable dealers.

If You Use a Contractor

If you plan to use the services of a renvation contractor, take care to choose one with a reputation for honesty and good workmanship. There are several ways to check on a contractor:

• Check with the HDB Registry of Renovation Contractors.
• Talk with people for whom he has done work.
• If your contractor is going to arrange for financing your loan, find out which lender he uses. Call the lender and inquire as to his record with the lender.
• Check his place of business to see that he is not a fly-by-night operator.
• Find out, if you can, how he rates with known building-product distributors and wholesale suppliers.
• Ask friends and relatives for names of firms that they could recommend.

Compare Contractor Offers

Before deciding on a contractor for homefix, you may want to get bids from two or three different firms. Make sure that each bid is based on the same specifications and the same grade of materials. If these bids vary widely, find out why.

Many contractors offer package plans that cover the whole transaction. Under such a plan the contractor provides all materials used, takes care of all work involved, and arranges for your loan.

Your contractor can make the loan application for you, but you are the one who must repay the loan, so you should see that the work is done correctly.

Understand What You Sign

The contract that both you and the contractor sign should state clearly the type and extent of improvements to be made and the materials to be used. Before you sign, get the contractor to spell out for you in exact terms:

• How much the entire job will cost you.
• How much interest you will pay on the loan.
• How much you will pay in service charges.
• How many payments you must make to pay off the loan, and how much each of these payments will be.

After the entire job is finished in the manner set forth in your contract, you sign a completion certificate. By signing this paper you certify that you approve the work and materials and you authorise the lender to pay the contractor the money you borrowed.

Beware of Fraud

Most dealers and contractors conscientiously try to give their customers service equivalent to the full value of their money. Unfortunately, homefix rackets do exist. Here are a few common sense rules to follow:

• Read and understand every word of any contract or other paper before you sign it.
• Never sign a contract with anyone who makes fantastic promises.
• Reputable dealers are not running give-away businesses.
• Avoid wild bargains. The best bargain is a good job.
• Never consolidate existing loans through a home improvement contractor.
• Do not let salespeople high-pressure you into signing up to buy their materials or services.
• Be wary of salespeople who try to scare you into signing for repairs that they say are urgent. Seek the advice of an expert as to how urgent such repairs are. High-pressure and scare tactics are often the mark of a phony deal.
• Avoid salespeople who offer you trial purchases or some form of bonus, such as cash, for allowing them to use your house as a model for any purpose. Such offers are well-known gimmicks of swindlers.
• Never sign a completion certificate until all the work called for in the contract has been completed to your satisfaction. Be careful not to sign a completion certificate along with a sales order.

Financing Improvements

As a rule, the thriftiest way to finance homefix is to pay cash. But if you lack the funds even for immediate repairs such as replacing a worn-out kitchen cabinet or a broken toilet, you should weigh the cost of borrowing against the cost of delaying the work. If you have to borrow, you want to do it in the least expensive way. Use caution when using credit card borrowing because of interest rates.

If you borrow money for the improvements, you should go to your bank or other lender and apply for a loan. After checking to see if your credit is satisfactory, the lender defines the terms of the loan and you must agree to them before signing the note. Do not proceed with homefix plans until you understand all of the costs involved.

Today there are a number of good plans for financing home improvements on reasonable terms. What kind of loan is best for you depends primarily on the amount of money you need to borrow.