Some of the best home improvement loans of 2021


Our goal here at Credible Operations, Inc., NMLS number 1681276, referred to as “Credible” below, is to give you the tools and confidence you need to improve your finances. Although we promote the products of our partner lenders who pay us for our services, all opinions are ours.

Man doing renovation work at home with his little yellow dog (iStock)

Your home is one of the most important purchases you will ever make, and where you will spend most of your time outside of work. Eventually, you may reach a point where you want, or even need, to start making improvements to your property, either to improve its function for your family or to create the home of your dreams.

But dreams don’t come cheap when you’re looking to transform your home with a home improvement or two. In fact, even a minor kitchen renovation costs an average of over $ 26,000, and just installing a new patio can easily exceed $ 16,500. So how do you foot the bill for these improvements?

Fortunately, there are a few great ways to finance a home improvement if you don’t have the cash on hand. Better yet: some of them don’t require you to tap into your home equity.

What is a home improvement loan?

A home improvement loan – which is basically a Personal loan that you take out to finance your home improvement project – can provide the financing needed for a repair or a project that will increase the value of a home.

Unlike many other types of loans (which we’ll get to later), a home improvement personal loan is usually unsecured and usually not tied to the equity in your home. This means that you don’t have to use your property as collateral for the loan.

How Do Home Improvement Loans Work?

A home improvement loan works like most other personal loans. Whether or not you are approved – and the loan limit, rates, and terms you receive – will usually depend on your credit health.

To take out a home renovation loan, you must apply for it with the lender of your choice. In some cases you may want to check the rates of several lenders at once. Credible can help you compare home improvement loan rates.

Your application will ask for personal and financial information, which your potential new lender will use to check your credit and make a loan decision. If your application is approved, you will be offered certain loan repayment terms. The length of the loan, monthly payments, and interest rates can vary widely depending on your credit history, the loan amount requested, and even factors such as your current income.

The best home improvement loans

Here are eight lenders you might want to consider if you’re looking for the best home improvement loans this year. Credible assess personal lenders by looking at eight different data points, including the lender’s minimum fixed rate, available terms, fees, discounts, customer experience, funding time, maximum loan amounts, and other factors.

The following four lenders are credible lending partners.


Loan conditions : One to five years

Loan amounts: Up to $ 35,000

Original costs: 0% to 2%

Other expenses: $ 15 late payment fee

Funding time: Next working day

Best for: Fast financing and low rates for applicants with excellent credit

Best egg

Loan conditions : Three to five years

Loan amounts: Up to $ 35,000

Original costs: 0.99% to 5.99%

Other expenses: $ 15 late payment fee, $ 7 check processing fee, $ 15 unsuccessful payment fee

Funding time: One to three working days after verification

Best for: Competitive rates and higher loan amounts


Loan conditions : Three to seven years

Loan amounts: Up to $ 35,000

Original costs: Nothing

Other expenses: Late fee of $ 39

Funding time: From the next working day

Best for: Long loan terms and no origination fees


Loan conditions : One to five years

Loan amounts: Up to $ 35,000

Original costs: Nothing

Other expenses: $ 29 late fee

Funding time: Usually two working days after verification

Best for: Smaller loans for borrowers in all 50 states

The following lenders are not partners of Credible.

PNC Bank

Loan conditions : Six months to five years

Loan amounts: Up to $ 35,000

Original costs: Nothing

Other expenses: Late fees are $ 40 or 10% of the amount owed, whichever is greater

Funding time: One to three working days from verification

Best for: Joint borrowers

American Bank

Loan conditions : One to five years

Loan amounts: Up to $ 50,000

Original costs: Nothing

Other expenses: Nothing

Funding time: One working day

Best for: Current US Bank Customers Looking for Higher Loan Limits

SunTrust Bank

Loan conditions : Two to 12 years old

Loan amounts: Up to $ 100,000

Original costs: Nothing

Other expenses: Nothing

Funding time: The same day in some cases

Best for: Immediate financing, large loans and long repayment periods

TD Bank

Loan conditions : Three to five years

Loan amounts: Up to $ 50,000

Original costs: Nothing

Other expenses: Late fee of $ 10 or 5% of the minimum payment amount due, whichever is less

Funding time: Next working day

Best for: Competitive rates and free of charge


Credible rates data on loans and lenders in seven categories. Data points considered include interest rates, fees, repayment terms, discounts, eligibility requirements, minimum down payment, and customer service.

Since lenders have their own borrower rating systems, your particular situation and the characteristics of the loan that are most important to you will determine which loan or lender is best for you, as well as the interest rate and the conditions for which you may be eligible.

The pros and cons of home improvement loans

Like any other financial product, there are both advantages and disadvantages of taking out an unsecured home improvement loan for your next project.


  • They won’t endanger your home. Since you usually don’t need to provide collateral for a home improvement loan (like the equity in your property), a home improvement loan can be a safer borrowing option than a loan. home equity loan.
  • They can help you increase the value of your home. You can use home improvement loans for a number of projects and improvements, from home repairs and renovations to building a new swimming pool. These improvements and repairs, when completed, can increase the value of your home or increase its resale value.
  • They can mean quick financing in one lump sum. Home improvement loans are installment loans, which means that once you are approved, you will receive a lump sum payment for the full loan amount. In some cases, you can get financing as quickly as the same day.

The inconvenients

  • They can cost more. Since home improvement loans are generally unsecured, you may find that they have higher interest rates than secured financing options.
  • There is no tax advantage. Some guaranteed home improvement funds (like a HELOC) may allow you to claim a tax deduction on the interest paid. But unsecured loans do not have such an advantage.
  • It can be difficult to borrow enough money. Many unsecured home improvement loans have limits of $ 35,000 to $ 50,000, assuming your credit score is high enough to qualify for this amount. If your credit rating is low or you need more money for a bigger project, this type of loan may not be for you.

What are the alternatives to renovation loans?

If a home improvement loan isn’t right for you or doesn’t provide you with enough funds, there are other alternatives to consider.

  • Home equity loan: A home equity loan can offer lower interest rates and higher loan limits, since your property is used to secure the debt.
  • Home equity line of credit: Home Equity Lines of Credit, or HELOCs, offer a secured revolving line of credit that you can use anytime, often with competitive interest rates.
  • Refinancing of collection: Although the process is a bit more complex, cash-out refinancing allows you to tap into the existing equity in your property to finance everything from home improvements to paying off debt or buying a second home.
  • Renovation mortgage: A mortgage renovation can be a simple loan option if you are planning to buy a property that is already in need of improvements or repairs.

Home improvement projects can be expensive at times, but they can add both to your enjoyment of the property and to its overall value. However, it is not always possible to pay for these upgrades out of pocket, so take your needs and personal circumstances into account when looking for the right home improvement loan product.

Credible makes it easy to compare personal loan and mortgage rates from multiple lenders.


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