When Does Remodeling a Home Make Sense?

Dear Dave,

My husbands company recently told everyone that massive layoffs are coming, and they should start looking for other jobs. Right now, all of his options are out-of-town. A real estate agent told us wed have to remodel our kitchen in order to sell the house. Weve got $3,500, but remodeling would take about $2,000. Should we get a second mortgage to get the work done?

-Pamela

Dear Pamela,

You might want to get another opinion. Sure, a new kitchen would be nice, but is that the end-all, be-all? Either way, theres no way Id go into debt to make this happen. Your house isnt even on the market yet. Theres no reason to fix up a house thats not for sale, especially when you only have $3,500 to your name!

There is, for sure, a financial storm brewing on your horizon. Start right now living on rice and beans and saving up piles of cash to build a bigger umbrella.

Wait until he actually lands another job before you make any big decisions. What if something pops up where you are? If you end up moving, then you might take $2,000 from savings to fix up the kitchen and get the house sold. Dont do it unless youre going to pay cash, though! You dont want a second mortgage hanging over your heads, making everything even more difficult.

-Dave

Dear Dave,

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When Does Remodeling a Home Make Sense?