Home Renovations: The Money You Can’t Afford to Spend

All home owners will face home repairs at some point or another

Home renovations involve the act of updating, repairing, or overhauling your home. They are a task that requires time, careful consideration, decision making, patience, and money. Sometimes a lot of money, depending upon the extent of the home renovation project you undertake. It is important that you decide beforehand how much money you wish to spend, as well as how much of your home you plan to renovate. The process may only amount to a small task, or conversely turn into a huge project, but whichever direction you choose, home renovations can take a financial and emotional toll on even the most savvy home owners going.

Sadly sometimes we need to undertake home renovations, whether we plan on it beforehand or not. It could be a matter of flooding, fire, lightning strike, tree damage, vandalism, or any number of reasons why home renovations need to occur immediately. While some renovations are inexpensive, there are plenty of others that can be downright costly though. Do you have an emergency fund set up for rainy day expenses? Approximately 1/3 of Canadians have nothing left in their bank accounts after bills are paid. That means that when unexpected expenses arise, money becomes a major issue.

Some home repairs need to be taken care of sooner rather than later

There are ways to combat the cost of emergency home repairs though.

If you have a mortgage, more than likely you also have home insurance. Most banks insist upon it to protect their investment, ie. your home. Home insurance covers the building, contents, and outbuildings, with some limitations depending upon your carrier. Therefore, if a tree falls on your home and damages it, your insurance company covers the cost of your repairs, depending upon your policy’s conditions. You will have to pay a deductible (anywhere from $100-$2000 as per your insurance company’s rates), but that is a far cry from the potential thousands of dollars that some emergency home repairs cost.

For those folks that struggle day-to-day and still find themselves in a low-income state, home repairs might seem like the end of the world. That does not always need to be the case, if you know where to look for assistance though. The Canadian Mortgage and Housing Corporation (CMHC) offers an Emergency Repair Program (ERP) for eligible individuals. Emergency items such as;

    • heating systems;
    • chimneys;
    • doors and windows;
    • foundations;
    • roofs, walls, floors and ceilings;
    • vents, louvers;
    • plumbing;
    • electrical systems

are some of the items that are taken under consideration for those who qualify. While you have to be approved for the repairs before the work is done, once approval is given any funds offered do not need to be repaid.

CMHC logo

CMHC logo (Photo credit: Wikipedia)

Likewise the Homeowner Residential Rehabilitation Assistance Program (Homeowner RRAP) from CMHC is another avenue to explore for low-income families that are faced with major repairs to their home. As noted on the CMHC website states;

“In general, mandatory repairs related to heating, structural, electrical, plumbing and fire safety are eligible for funding under Homeowner RRAP. The quality of the repairs should ensure the useful life of your home for at least 15 years.”

Another place to look for help is the Investment in Affordable Housing for Ontario program. It also offers funding for low-income individuals to help renovate their homes. There is paperwork to be filled out for eligible people, but with the potential to receive upwards of $25,000, it just might be worth it to get that financial assistance, as well as a new energy-efficient furnace, low-flow toilet, or window replacements.

Branding image of the Government of Ontario, s...

The Ontario government also helps seniors in need of undertaking home renovations by offering a Healthy Homes Renovation Tax Credit. Seniors aged 65 and older are eligible for a tax credit on their income taxes of up to $10,000 come tax time. While that doesn’t put money in your pocket instantly, it does help to ultimately reduce costs of necessary home improvements that increase safety and accessibility to your home. Your income doesn’t matter, and if you have a senior living with you, you are still eligible. You can receive 15% of eligible expenses back, so save your receipts!

Do you know other ways to reduce costs of home renovation projects? Are you aware of other programs or grants that help people cover the cost of unexpected home repairs in Canada? Leave me a comment, so that I can help spread the good word to those in need!

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