home improvements

Home Improvement Loans

Interested in getting a loan for home improvements? Here’s what to look for and the traps to avoid.

Home renovations can improve your lifestyle and add to the value of your property. If your family’s growing, it could also necessary. However, home improvements are expensive. If don’t have the money to finance this investment, you can consider a home improvement loan to cover the costs. In this guide, we’ll take you through some of the financing options available and what you need to know to find a home improvement loan that’s right for you.

Lending Club Personal Loan

Lending Club Personal Loan

Lending Club offer you the chance to borrow up to $40,000 as alternative to bank personal loans. Rates from 5.99% to 35.89%%* APR based on your credit score.

  • Recommended Credit Score: 660 or higher
  • Min. Loan Amount: $1,000
  • Max. Loan Amount: $40,000
  • Loan Term: Flexible Terms
  • Turnaround Time: Varies
  • Total Costs: Depends on your credit score.
  • Consolidate loans or pay off high interest debt
  • Confidential and secure online application!

    Personal loans you can apply for

    Rates last updated May 27th, 2017
    Unfortunately, none of the personal loan providers have a loan for that credit score. It you are urgent need of a small loan, you might want to check out a short term loan.
    Minimum Credit Score Max. Loan Amount APR Requirements
    Prosper Personal Loan
    Borrow only what you need for debt consolidation, home improvements, special occasions and more — with APRs based on your credit score.
    640 $35,000 From 5.99% (fixed) You are over 18 years of age, you are an American citizen or a permanent resident of the US, and you don’t have bad credit history. Go to site More
    Lending Club Personal Loan
    Borrow up to $40,000 with rates from 5.99% to 35.89% APR based on your credit score.
    660 $40,000 From 5.99% (fixed) You must be over 18 years of age, a permanent resident of the US or an American citizen and have a steady source of income. Go to site More
    Upstart Personal Loans
    This newer service looks beyond your credit score to match you with accredited investors for low-rate personal loans.
    660 $50,000 From 7.16% (fixed) 18+. US citizen or permanent resident. 660 credit score or higher. Go to site More
    NetCredit Personal Loan
    You could borrow up to $10,000 and get an interest rate personalized to your credit score
    550 $10,000 From 34% (variable) Varies based upon state of application Go to site More
    SoFi Personal Loan Fixed Rate (with Autopay)
    Borrow up to $100,000 with a competitive APR and no fees.
    Good to excellent credit $100,000 From 5.49% (fixed) You must be a U.S. citizen or permanent resident 18 years or older. Go to site More
    OneMain Financial Personal Loans
    Get funded quickly with a term loan that works for your circumstances — even with bad or no credit.
    600 $25,000 From 12.99% (fixed) Eligibility for a loan is determined by your financial history, credit history, income and expenses, and whether or not you have ever filed for bankruptcy. More
    Avant — Personal Loan
    Check your rate — without affecting your credit score — before applying for this unsecured personal loan.
    600 $35,000 From 9.95% (fixed) You must have at least a fair credit score of 580 or more), provide proof of a steady income and be a US resident who is at least 18 years old. More

    Have we missed anything in the comparison table? Tell us

    • If the provider quotes a different rate to the one above please let us know

    Personal loan lender matching services

    These matching services connect consumers with personal loan lenders. It is important to note that these services do not make credit decisions and they are not lenders, loan brokers or agents for any lender or loan broker. They can help link you up with a lender that might be able to help you access a loan.

    Rates last updated May 27th, 2017
    Unfortunately, none of the personal loan providers have a loan for that credit score. It you are urgent need of a small loan, you might want to check out a short term loan.
    Minimum Credit Score Max. Loan Amount APR Requirements
    LendingTree Personal Loan
    Apply with this online marketplace for loans to consolidate debt, buy a car, pay for a special occasion and more.
    639 $35,000 From 5.99% (variable) You must be an American citizen or a permanent resident of the US, You must be at least 18 years of age and You should have a regular source of income Go to site More
    PersonalLoans.com
    An online loan matching service that connects you with lenders for peer-to-peer, personal and bank loans for a variety of purposes.
    Varies by lender $35,000 From 5.99% (variable) You must be employed, 18+ with a bank account. Go to site More
    Zippyloan Personal Loans
    This broker matches applicants to lenders offering $100 to $15,000, often with flexible repayment options.
    $15,000 From (variable) Good credit, a steady income and manageable debt. Go to site More

    Have we missed anything in the comparison table? Tell us

    • If the provider quotes a different rate to the one above please let us know

    How does a home improvement loan work?

    Depending on the type of changes or updates you want to make on your property, there’s a variety of loans available for home improvements. These loans all have key features and differences,  so it’s important to compare your options to find the best one to suit your needs and situation.

    • Secured or unsecured. If you have some equity in your house, you can consider getting a secured loan.This option uses your home equity as collateral for the money you borrow. If you don’t have enough equity in your home, or if you don’t want to use it as collateral, you can get an unsecured loan.
    • Fixed or variable (floating) rate. Providers of home improvement loans may offer you a choice between a fixed and variable (or “floating”) interest rate. With fixed rate loans, your repayments remain the same throughout the loan term. If you opt for a variable rate loan, your rate may start lower but can fluctuate over the life of your loan. This is because the interest rate for variable rate loans depend on the London Interbank Offered Rate (LIBOR), which is the interchange rate banks use to set their rates. Check if your bank has a cap for how high your variable rate can climb.
    • Protection against losses. If you have limited equity in your home, you can think about getting a National Housing Act authorized FHA Title I loan. With these loans, FHA insures lenders against possible losses.

    Features on offer with home improvement loans

    If you’re interested in getting a loan for home improvements, make sure you consider the following factors:

    • Security. You need to have enough equity in your home to get a secured loan. Alternatively, you may be able to use a vehicle as security for the loan, providing the value of the car is sufficient. You can also apply for an unsecured loan.
    • Interest rate. This is the amount of interest you will pay on the money you have borrowed for your home improvements. Secured loans tend to come with lower interest rates than unsecured loans because it’s less of a risk for the lender. Interest rates can vary even with these kind of loans, so paying attention to this aspect is crucial. Some lenders offer interest rate discounts if you sign up for automatic repayments.
    • Loan term. A longer loan term will give you lower ongoing repayments, but at the end of the loan term you will have paid more interest. This adds to the overall cost of getting the loan. In contrast, higher repayments and a shorter loan term help keep the overall cost of the loan down.
    • Processing time. Depending on the kind of credit you’re looking for, you can receive your loan funds within a day of approval, although in some cases the process may take a week or more.

    The benefits and drawbacks of getting finance for home improvements

    • Carry out time-sensitive repairs. A home improvement loan lets you carry out repairs as soon as possible. Postponing repair work until you’ve saved the money can result in more damage, which can also lead to more expensive repairs.
    • Various loan options. No matter what type of home improvement you’re looking at doing, you have a range of loan options to choose from. These include home equity loans, home equity lines of credit, unsecured or secured personal loans and personal lines of credit.
    • Taking on too much debt. If you apply for a loan you can’t afford to pay off, you run the risk of taking on debt you can’t manage. Make sure you budget for your repayments based on your financial situation before you apply.
    • Finance doesn’t account for renovation budgets or schedule changes. If anything happens that affects the budget or schedule of your renovations, it could impact on your ability to make loan repayments. Make sure you leave room to move in your budget so that you can still make repayments if anything unexpected happens and you need extra funds.

    Is there anything to avoid when deciding on your loan?

    Unplanned or poorly considered renovation projects should be avoided at all costs. This is especially true if you’re planning to finance it with a loan. Home improvements often involve  long and expensive processes, and you need to be financially prepared to cover it.

    If you think you may have problems in repaying the loan, avoid taking it. If you don’t make your repayments on time, your credit score will be negatively affected – and if your loan is secured you could lose your home.

    Frequently asked questions

    With a home improvement loan, you receive all of the funds as a lump sum payment. You then have to pay interest towards the entire amount borrowed. A line of credit gives you access to a credit limit. You’re then able to draw on the funds up to that limit when you pay for your renovations. You only pay interest on the funds you use, and if you make repayments on your credit limit, you can then use those funds again.

    Home improvement loans are available for people with low credit scores. However, you might have a better chance of being approved if you apply for a secured loan.

    Most banks and credit unions in the US provide home improvement loans. You can start by comparing some of your options on the page above. Once you find a loan you’re eligible for and that you want to apply for, click “Go to Site” to complete and submit your application.

    Image: Shutterstock

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    US Personal Loans Offers

    Learn about our information service
    Lending Club Personal Loan

    Borrow up to $40,000 with rates from 5.99% to 35.89% APR based on your credit score.

    Prosper Personal Loan

    Borrow only what you need for debt consolidation, home improvements, special occasions and more — with APRs based on your credit score.

    Upstart Personal Loans

    This newer service looks beyond your credit score to match you with accredited investors for low-rate personal loans.

    PersonalLoans.com

    An online loan matching service that connects you with lenders for peer-to-peer, personal and bank loans for a variety of purposes.

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