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The most common ways to pay for a home remodeling project are either to refinance the house completely, or to take out a home equity loan or line of credit. Those plans make sense; the cost of remodeling can run in the tens of thousands of dollars and rarely do homeowners have that sort of cash lying around. Instead, they go back to their bank or mortgage company and take out another loan. Home equity loans work best for projects of finite cost and duration. Lines of credit, which are renewable loans, work best for long term projects, do it yourself projects, or projects of unknown duration.
Some clever people have taken to using airline credit cards for projects that would ordinarily be better suited to a home equity line of credit. By charging thousands or even tens of thousands of dollars worth of material and labor to their cards, they are able to quickly rack up thousands of frequent flier miles which can be exchanged for round trip tickets to domestic or foreign locations. Some people then pay off the cards with cash, while others simply take out the aforementioned loans and pay off the cards with the money from the lenders. Either way, the borrower gets the benefit of both the remodeling project and the travel.
Those who wish to take advantage of this useful tool should be aware that the rules of frequent flier programs frequently change. The number of miles needed to take a trip can be changed by the airlines on a whim. And flights, particularly to those with high demand destinations, are often limited as to the number of free tickets that can be used on that flight. That being the case, you might have to book your trip well in advance of when you would like to travel.
Still, it’s nice to see an opportunity to get something useful out of a home loan other than plain old interest, which no one likes to pay.
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