How to keep to your budget on a remodel

Before you decide to remodel, the first thing that you need to decide on is the budget. With out the budget set in stone, you are going to have some big time problems. Most people fail to recognize what the actual costs that are involved with a remodel or with most any other home improvement project. So, we will get started from the point the idea has come into your head for a home improvement project. First, what is your source for the money you will need. Next, how much will you have and last, how fast is it available to you. If you are getting a loan, what are your payments going to be for the total amount and what payments can you REALLY afford? figure out what you can afford, find out how much you can borrow with that payment and that would be your max level of budget. Now, lower that by 20% and that is your target budget. I say lower it by 20% because most home projects will and do go over budget by about 10% - 15% if you have a solid contractor doing the work. Now that you have a set budget you can interview and hire a contractor. If the project includes a kitchen, bath or master suite what you will need to do is go out and check the stores for items that you are going to replace, such as: toilet, sinks, tubs, cabinets, hardware, tile, flooring, showers ...etc. It would be very wise to tell your contractor that you will purchase the items, this will allow you to save on his markup which could be as much as 25%.
Most contractors will give you an allowance for certain items, but, keep in mind they are going to make a profit on each item. Next, get the contractors estimate in writing and make sure it lists the labor and material costs separately. This will allow you to see what you are being charged for on his labor and will help you stay on top of your budget all the way throughout the project. The costs of the permits also have to considered when figuring the budget as well, you will need to contact your local building dept to find out what it will cost for all the required permits. Then it will be advisable for you to draw up your own plans (if possible) and submit them to the town. This could save you a large amount of money. Most states allow the homeowner of a single family dwelling to draw his or her own plans and usually the local official will be very helpful in advising you what will be required on the drawings.
Now your ready to start your project. Along the way there will be some pitfalls that will cost you, but, at least you will have the extra cash in your budget to be prepared for most anything that comes up. Just remember that your contractor MUST give you a written estimate for anything that does come up before he or she performs the work. Last but not least, never pay your contractor the last payment until the town officials have passed the project on its final inspections, not only is this wise as a consumer, ITS THE LAW.

Robert Appel
www.peakimprovements.com

So You Wanna Be Your Own General Contractor

We all watch them. HGTV, DIY, TLC, A&E, they all have one thing in common, home improvement shows. Everyone will watch Richard and Ginger do it with ease. They all see Armando and family do it with out too much trouble. Even that really nice guy on Extreme Makeover Home Edition can do it and in only 1 week! DON'T BE FOOLED! Did you ever hear the old adage " The man that represents himself in court has a fool for a client"? When someone decides to be his or her own Contractor, that person is assuming a large risk. Without professional guidance or a contracting consultant you can and probably will lose lots of money. What you do not see on tv are all the headaches, the yelling and the aggravation that goes along with the job. There is a skill to the job. That skill is developed from years of experience, learning from mistakes and multi tasking. Think of it this way, the first time you played baseball, did you hit a home run? The first time you got on a bike, did you fall off? The first time you roller skated, did you fall? Did you ever do anything for the first time and do it as good as a professional? probably not. When you play contractor on your own home remodeling project, you will make mistakes. Those mistakes will cost you and the cost will probably run into the thousands of dollars. If you do decide that this is something you need to do, the best and safest way is to hire a consultant. With the consultant you can go over schedules, permits, ask questions when ever needed, what materials are the right materials and even go over the contracts of the subcontractors. But, keep in mind that when you do decide to be your own contractor, you will have to be on site every day all day. Doesn't that sound fun? No, it's not. It's alot of work. Just as you would not represent yourself in a two hundred thousand dollar lawsuit, you shouldn't play contractor on a two hundred thousand dollar house. Leave the accounting for the accountants and the contracting to the contractors.

Robert
www.peakimprovements.com

SELECTING THE RIGHT CONTRACTOR

The most important decision you will make when starting a project on your house is the selection of the contractor. A reputable, honest and responsible contractor can make the project painless and somewhat worry-free. However, if you hire the wrong contractor for your project, the shoddy work will cost you much more than you budgeted, along with numerous other nightmares you will end up with.

The selection process could start with a talk to people you know that recently had work done on their house. You can also call your local Chamber of Commerce for a list of businesses in the area, or, call the Better Business Bureau. There are other organizations that pre-screen contractors who are members of that service, such as Service Magic.com, Renovation Experts.com or Construction Deal.com. Next, you should contact at least 5 contractors, 3 should call you back and come for the free estimate.

When meeting with each contractor ask to see 3 written references and some photos of work they have done. While the contractor is there, you should also ask about his/her business insurance. After receiving the written estimates you will need to do some thinking. It’s easy to just take the lowest price and say “that’s my guy” but that’s not a smart move and you are really asking for trouble. Start by calling the references you have received from the contractors, ask them if the job was completed in a timely manner and if they received the finished product and the value they were contracted for. Ask if that person would use the same contractor for future projects.

The next thing would be to call the contractors that are still in the running and ask them to stop by to go over the written estimate. During this process, explain the budget you are on and try to get a read on the contractor, see if he shows any enthusiasm for getting the contract and doing the work. After these steps, then you can start to negotiate a price with the contractor whom you feel most comfortable. There is more to hiring a Contractor than just price, a cheap price may say more about the contractors desire to get the job than it does about the quality of the work he or she will deliver.

A good contractor will walk you thru the construction process and help you make decisions not based on his benefit, but yours. He or She will also offer advice knowing that you are on a budget and work with you to stick to the budget. I recently read an article and picked up on an interesting quote from a 19^th century economist by the name of John Ruskin who wrote “When you pay too much, you lose a little money, that is all. When you pay too little, sometimes you lose everything, because the thing you bought was incapable of doing the job it was bought to do.”

Robert

www.peakimprovements.com