How to Create a Budget for Your Siding Project

Budget for Siding

How Much Can You Afford?

Calculate your income, expenses, needs, and wants to determine how much you can set aside for this home investment. Your contractor is a key resource for estimating costs beyond your personal goals. However, this is your project and your money, so make sure to balance their advice with your priorities.

What Is Your Home Equity?

If and when you decide to finance your siding installation, your home equity could play a pivotal role in everything from your loan amount to your interest rate. Simply put, your equity is the difference between what you owe on your home or property and the appraised (or market) value determined for it.

The more of your mortgage you’ve already paid, for example, the higher your equity in the given property. And the more equity you hold in your home, the more powerful you are as a borrower, especially when it comes to purchasing power, or the financial ability to buy (or purchase) things.

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What Is Your Credit Rating?

From your credit score to your existing savings, purchasing power, and other ongoing loans, various financial institutions will have slightly different scales by which to determine your eligibility for a home improvement loan. And while some programs are certainly designed to be on your side—like the HomeStyle Energy Program or the Title I Property Improvement Loan—you’re going to be paying back in some way.

One of the most significant markers of your financial health—as determined by financial institutions, anyway—is your credit score. Plainly put, a credit score is “predicts how likely you are to pay back a loan on time,” according to the Consumer Financial Protection Bureau. Companies us proprietary  scoring models to calculate your credit score using information from your credit reports, which essentially break down your “credit activity and current credit situation, such as loan paying history and the status of your credit accounts.”

Knowing your credit rating and how you’ll be considered as a borrower will go a long way in helping you determine how much you can afford as you budget for new siding.

Be Real About Your Siding Needs

Surveys reveal homeowners often struggle with siding project details and turn to Modernize for support.

You likely understand the project scope based on your contractor’s input. While their focus may enhance protection and insulation, it might not match your personal or aesthetic goals. Clearly share your priorities with your contractor.

Trust is a two-way street. When you are upfront about your goals and budget, your contractor can design the right budget for your siding project. It may not be exactly what you envisioned, but it will deliver the best value for your investment.

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