Your finance options when you would like to add a pool to your property
A swimming pool can provide hours of entertainment for the members of your household, plus it can add significant value to your home. Whatever the reason for wanting a pool, you may underestimate the cost of building one. If you decide to look into finance options, there are a few loan types you can consider.
Before jumping in at the deep end and applying for the first loan you find, read our guide on what you should look for in credit for a swimming pool, and how you can discover the right finance option.
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Swimming pool loan comparison
What options do I have to finance a swimming pool?
The type of loans for a swimming pool work in much the same way as regular personal loans or loans for home renovations. You have a few choices:
- Secured personal loan. A secured personal loan requires you to attach an asset to your loan as security. You may choose to guarantee the loan with something like your car or house, or if you have a mortgage, you can use the equity in your home as security. These loans are less risky for a lender so they can offer lower rates and fees.
- Unsecured personal loan. This loan does not require you to use an asset as security, meaning it is less risk for you to take on. To offset the increase in risk that the lender takes on, you can expect higher rates and fees for the loan. These loans are often more flexible, as you can use the loan amount to finance not only the pool but any other purchases also.
- Mortgage finance. People looking to finance home repairs may opt to increase their mortgage amount, which means they keep their debt in one place and can better manage the repayments. Bear in mind that the interest the provider charges you may be higher than other personal loans, although you may save money by not having to pay fees on a separate loan. Calculate all the costs you will incur to see if this is a good option for you.
- A line of credit. If you are not sure how much you should borrow or want easy access to additional funds, you can consider a line of credit. You can access up to and including your credit limit and pay back what you borrow. By making repayments, you can re-access the funds immediately.
How can you choose a loan for a pool?
If you’re looking at a loan to build a swimming pool, you should keep the following points in mind when you compare your options:
- The lender. The provider offering the loan should help inform your decision. Make sure you read customer reviews of lenders online; see how easy they are to contact and how efficient their customer service is.
- Loan terms. The length of time you can borrow the money is referred to as the loan term, and it’s something you should confirm before applying for the loan. Calculate the repayments you can afford, and then see how long the provider will let you borrow the money. The term differs between lenders, so choose one that suits your needs.
- Loan amount. The lender may restrict the amount of money you can borrow depending on the type of loan you choose and your financial circumstances. Check to see if you can borrow the amount you need before applying.
- Loan purpose. Specific loans, for example, secured loans, have restrictions on the way you can use the funds. If you plan to use the loan amount to finance a pool and also an additional purchase, you should check with the lender to make sure this is okay.
- The actual cost of the loan. To calculate the real cost of credit, make sure you take into account the interest rate; the upfront and ongoing fees; the amount of money you are borrowing, and the loan term.
Pool costs to consider
Like many significant expenses, the process of purchasing and installing a new swimming pool may contain unforeseen expense. Make sure you bear the following in mind when you are budgeting:
- Installation issues. Even if the pool you purchase is going to be above ground, there is a certain amount of digging that will have to be done to make the ground level. Running into complications like large rocks or water lines can significantly add to the cost of your pool installation.
Many homeowner insurance lenders charge extra for a swimming pool on the premises, but it is not something you should avoid by not telling them. The additional insurance premium can protect you if something does happen.
A barrier around the swimming pool is an essential safety feature and is a legal requirement when installing a new pool. The type of fence you choose depends on whether you have children or pets, and the kind of pool and backyard.
- Maintenance. Once the pool is ready for swimming, you need to consider maintenance issues. Even if you don’t plan on hiring a company to do the cleaning, you still have to invest in chemicals and cleaning equipment.
How to choose a pool
You are going to have a few options to choose from when deciding on the right swimming pool for your backyard. Knowing the kinds of activities you plan to use your pool for, may help you select the best style and type for your home:
- Above-ground or in-ground. You either submerge a backyard swimming pool into the ground, or it sits on top. In-ground swimming pools add value to your home but are typically more expensive. An above-ground swimming pool may be more straightforward and cheaper to install but might not be as pleasing to the eye.
- Size. The size of your swimming pool depends on the size of your yard. You don’t want a swimming pool that leaves no space to do anything else. Also, allow for an area to build a deck around the pool if you wish to create a relaxing atmosphere outside.
- Shape. Above ground pools limit you to round and oval shapes, but if you choose an in-ground pool, you can select from a multitude of models. If you are considering a pool to work out in, a rectangular swimming pool is ideal for laps.
- Depth. The depth of the pool is an important decision, especially if you have young children. Many homeowners that have in-ground pools have a graduated depth, with one end being 1 to 1.5 metres deep for kids and three or more metres deep at the far end to accommodate a diving board or slide.
- Material. Both in-ground and above-ground pools can be built using different types of materials. You can construct an in-ground pool using concrete, fibreglass or vinyl. Concrete allows you to shape the pool exactly how you want it, whereas vinyl is the less expensive way to have an in-ground pool installed. Above-ground pools can be rigid, using the walls to hold the pool in place, or they can be soft sided. A soft-sided pool is not much more than a vinyl liner and can be conveniently taken down for the winter.
A swimming pool is a fun and exciting addition to any home. Choose the one that is right, and you’ll have years of summertime fun right in your backyard.
The costs of a swimming pool
Building a swimming pool is a considerable expense that can set you back tens of thousands of dollars. When deciding how much money to borrow to build a pool, think about all of the following costs which may apply:
- An above-ground pool can cost between $1,000 and $7,000 (excluding installation).
- An in-ground fibreglass pool can cost you from around $35,000, while a concrete one may set you back approximately $55,000.
- For a completed in-ground pool, with all landscaping done, you can expect to pay between NZD$60,000 and $100,000.
Is there anything else to consider?
Before you take out a loan to build a swimming pool, consider your financial situation, and the stability of your income. If you have substantial debt already, you may want to reduce this before you apply for a loan. Also, you might want to consider getting a few quotes for the pool, to see how much you need to borrow, and to avoid applying for multiple loans.
How to apply for your chosen pool loan
If you would like to apply for a loan to finance a swimming pool, check out your loan options using the comparison tables above, or head to the page of your chosen loan provider. When you find a suitable choice, click the “Go to site” button to be securely transferred to the lender’s website. From there you can fill out an online application form.
To apply for a loan in New Zealand, you usually need to:
- Be over the age of 18
- Be a New Zealand citizen or permanent resident
- Have a good credit rating. If your credit rating is not perfect, some lenders may be able to help.
- When you apply, you need to provide personal details; financial details, including assets, debt and liabilities; your employment details, including employer’s name and contact information, and your income and pay frequency.