How to Create a Refinishing Budget

A refinishing budget is very important in achieving your kitchen and bathroom remodeling projects. With all the many home improvement stores like Home Depot, Lowe's, to HGTV, it seems like almost anybody thinks that they can trade places while being the weekend warrior. Refinishing is better left to professionals.

Remodeling using Refinishing Stars saves you money and time. But whether your project is big or small, you need a refinishing budget.

First of all look at your kitchen and bathroom and decide which items on your refinishing budget are priorities. Decide for instance, if you want granite countertops and special ceramic tile floors? Or maybe you want wall-to-wall ceramic tile in the bath Take your time and write down your plan.

Armed with this information, go ahead and fill out our refinishing estimate questionnaire.

Once we receive the information on your refinishing needs, we will email you a written estimate for your project. After you receive your refinishing estimate from us, you can start preparing your refinishing budget.

Preparing Your Resurfacing Budget

This might not be a pleasant exercise, but go ahead and add up all your debts. Make sure that you include any debts that you pay every month.

This is your monthly expenses.

• mortgages
• car notes
• credit cards payments
• groceries
• utilities
• telephone services
• transportation
• clothing
• health and life insurance
• personal care
• recreation and social
• personal improvement
• gifts and contributions
• contingencies
• family allowances
• work related expenses
• other general expenses
• ADD ALL TO GET YOUR TOTAL MONTHLY EXPENSES

This is your monthly income.

• estimated take home pay
• estimated other income
• ADD ALL TO GET YOUR MONTHLY INCOME.

With these two powerful sets of information, you are ready to prepare your budget. Banks use the ratio of the money you owe and the money you bring to determine whether they will give you alone or not. They call it Debt-to-Income (DTI) ratio.Here is the math for you.

First Step:

Ask the company that is lending you money what their DTI ratio is. In our example, let's say that that your lender accepts DTI ratios of 45 percent. You are close, but if your credit rating is good and you have plenty of equity in your home, its likely you'll be approved. Congratulations. That brings us to-

Second Step:
Now the second step is to figure out the maximum amount of money you can pay every month for refinishing. This is the math:

Your monthly gross income amount x your lender's maximum DTI allowance - your current total monthly expenses, not counting the money set aside for refinishing payment.

Use this figure to determine the maximum amount your lender can let you borrow. In our example we assume that your home improvement loan is a fifteen year note at seven percent. From this exercise, the maximum amount of money you can borrow is forty-seven thousand dollars for your resurfacing project considering your monthly payment.

Third Step:
The last step for your refinishing budget is to consider money at hand. In this example, we assume that you have three thousand dollars in excess funds available for this project. This brings your maximum project budget to fifty thousand dollars.

The main reason why we did this exercise is to establish a starting point for your project. Now you must have a spending limit. With our estimate, you've seen how can save up to 80% of what it would cost to replace.

Other Resources for budgeting:

www.nari.org/homeowners/tips/index.asp?sort by=products

www.costestimator.com/hgtvkitchen/index.jsp

www.buzzle.com/editorials/11-5-2001-5847.asp

www.nari.org/homeowners/news/article.asp?ARTICLE_ID=

5&F_CATEGORY_ID=11&SECTION_ID=1