How to Get a Personal Loan for Home Improvement

A personal loan for home improvement is an unsecured loan you can use to fund repairs, renovations, or upgrades — without putting your home or savings at risk. If you don't have the funds on hand, a personal loan could give you fast access to the money you need, with a repayment schedule that fits your budget.

There are several types of home improvement loans to consider, each suited to different project sizes and financial situations. Here's what you need to know.

How a home improvement personal loan works 

These loans can help finance projects such as: 

• Painting your home's exterior or interior
• Remodeling a bathroom
• Installing new appliances, such as an air conditioner or water heater
• Updating plumbing systems 

Some loans provide a lump sum upfront, which works well for projects with a clear, fixed cost. Others, like a revolving line of credit, let you withdraw funds as needed — giving you flexibility for ongoing or unexpected expenses.

You'll repay the loan, along with any interest and fees, over a period agreed upon with your lender. Depending on the loan type, repayment may be structured as fixed monthly installments or, in some cases, a single payment.

Types of loans for home repair or improvement 

Installment loan 

An installment loan could be a solid choice if you're planning a home improvement project that requires a substantial amount of money upfront. You receive the full amount at once and repay it through fixed monthly payments over a set period — making it easier to budget for the cost from the start.

Installment loans are a good fit for large, one-time expenses, such as replacing an air conditioner or furnace. You get immediate access to the funds you need, so you can start important repairs or upgrades without delay.

Payday loan 

A payday loan could be a good option if you need a small amount of money for quick, minor home improvements. Typically capped at a few hundred dollars, these short-term loans are designed to be repaid by your next payday.

Because of their smaller size, payday loans work well for minor projects, like repainting a room or fixing an appliance. You get fast access to funds, so you can take care of small repairs without a long-term commitment.

Personal line of credit 

If you prefer flexibility, consider opening a line of credit. Unlike a lump-sum loan, this option works like a credit card, giving you access funds as needed — up to your approved limit. 

You can withdraw money whenever you need it and repay it all at once or over time. You only pay interest on the amount you use, not the full credit limit. A personal line of credit is especially useful for longer or ongoing home improvement projects, giving you continuous access to funds throughout.

Title loan 

A title loan is a type of secured loan where you use your vehicle as collateral. The lender assesses its value and typically approves a loan amount ranging from 25% to 50% of that value.

If you're unable to repay the loan, the lender has the right to take possession of your vehicle. For that reason, it's worth exploring other home improvement loan options first — and only considering a title loan if other options aren't available to you.

Pawn shop loan

A pawn shop loan is a type of secured loan where you use a valuable item as collateral to borrow money. Items like jewelry, collectibles, and electronics are commonly accepted.

Keep in mind that if you don't repay the loan, the pawn shop keeps your item. It's a quick way to access cash, but make sure you're comfortable with the risk of losing your collateral before choosing this option.

🔗 Related: What Is a Title Pawn?

Where to get a personal loan for home improvement

Banks 

Traditional banks are a common option for home improvement loans. They often offer competitive rates and terms, particularly if you have a solid credit history.

Keep in mind that banks typically have stricter credit requirements and may take longer to process and approve your application.

Credit unions 

Credit unions can be a good option if you're looking for a home improvement loan from a local, community-focused lender. They often have less restrictive credit requirements than traditional banks, which can make it easier to qualify.

Keep in mind that the approval process at a credit union may take longer — sometimes weeks. If you need funds quickly, this may not be the best fit. 

Online lenders 

Online lenders offer a straightforward way to get a home improvement loan. They typically provide a range of personal loan options, and the application process is often faster than with traditional banks.

Just keep in mind that repayment terms may be less flexible, and some online lenders can be harder to work with if you run into repayment difficulties. 

Direct lenders 

Direct lenders can be a good option if you need a fast, straightforward loan process. Because there's no third party involved, the process is often more streamlined — and some direct lenders offer same-day funding.

You can apply online or in person. Just be sure to research your lender and read reviews before you apply to make sure they're transparent and reliable. 

Other types of home improvement loans 

Home equity loan 

A home equity loan lets you borrow against the equity you've built up in your home — the difference between your mortgage balance and your home's current market value. It provides a lump sum of cash that you repay through fixed monthly payments over a set period.

Home equity loans can offer lower interest rates than other loan types. However, if you're unable to make payments, the lender can foreclose on your home. Make sure you're confident in your repayment plan before choosing this option. 

Home equity line of credit 

A home equity line of credit (HELOC) works like a personal line of credit secured by your home. The amount you can borrow is based on the difference between your home's current market value and your mortgage balance.

Unlike a home equity loan, a HELOC lets you withdraw funds as needed rather than receiving a lump sum. This can be a good fit if you need a larger amount but aren't sure exactly how much or how often you'll need it.

Just make sure you have a solid repayment plan before choosing this option. Missing payments on a HELOC can lead to foreclosure, just as with a home equity loan. 

Cash-out refinancing 

Cash-out refinancing can be a good option for larger, long-term home improvement projects. It involves refinancing your existing mortgage and borrowing against your home's equity — up to 80% of its appraised value.

It works similarly to a home equity loan, but may also allow you to secure a lower mortgage rate in the process. 

FHA 203(k) rehab loans 

FHA 203(k) rehab loans are government-backed loans that help homeowners finance home improvement projects. This option involves refinancing your existing mortgage and borrowing against your home's value, combining the cost of your home and renovation expenses into a single mortgage.

Mortgage renovation loans 

Conventional mortgage renovation loans work similarly to FHA 203(k) loans but often provide larger funding amounts. Options like Fannie Mae’s HomeStyle Renovation and Freddie Mac’s CHOICERenovation loans typically come with fewer restrictions than FHA 203(k) loans, which can make them a good fit if you need more flexibility or substantial financing for your project. 

Government grants and assistance 

Besides loans, you may also qualify for government grants to help with specific home improvements. Depending on your location, grants may be available for upgrades that boost energy efficiency, helping you save on utility bills while improving your home. 

These grants may cover projects such as: 

• Solar panels
• High-efficiency air conditioners
• High-efficiency water heaters
• High-efficiency heating systems 

Eligibility can vary based on factors like your age, the age of your home, and your income level. To see if you qualify for these programs, visit USA.gov for more information. 

Can you get a home repair loan with bad credit? 

Yes, it may be possible to get a home repair or improvement loan with bad credit, though your options may be more limited. Looking for personal loans from direct or online lenders with more flexible credit requirements can be a good place to start.

Get a personal loan for home improvement today 

If you're looking for a fast, reliable way to finance your home improvement project, explore the loan options available at Advance America. We offer multiple solutions, including payday loans, installment loans, and personal lines of credit. Depending on your financial situation, you may qualify even with a less-than-perfect credit score. 

Explore options

Home improvement tips 

Whether you're upgrading to sell or improving your space for the long term, these tips can help you make smart decisions and get the most out of your investment.

Plan and budget

1. Finance only what you need. Before taking out a home improvement loan, create a budget to determine exactly how much you need. Financing only what's necessary helps minimize interest payments and fees. If you're unsure about the exact amount, a personal or home equity line of credit can offer flexibility.

2. Look for government assistance. Consider improvements that qualify for government grants or assistance programs. These can help you upgrade your home at little to no cost while improving energy efficiency and buyer appeal.

3. Increase your home equity. If you're considering a home equity loan or line of credit, paying down your mortgage can increase the amount available to you. More equity means more funds for your projects.

Upgrade smart

4. Focus on bathrooms and kitchens. When upgrading your home to boost its value, start with the bathrooms and kitchens — these are top priorities for home buyers. Focus on modernizing lighting, cabinets, flooring, showers, and sinks. Light, contemporary upgrades can make these spaces feel brighter and more inviting.

5. Prioritize appliances and fixtures. Whether you're selling or simply want a more comfortable home, upgrading appliances and fixtures is worth the investment. Opt for high-efficiency options — they save on energy bills and are built to last.

6. Cosmetic upgrades pay off. To keep costs down, focus on cosmetic improvements. A visually appealing home can make up for other shortcomings — especially if you're planning to sell. Consider painting walls and ceilings, updating flooring, and refreshing cabinets with a new coat of paint.

7. Don't overlook the exterior. Interior upgrades matter, but the outside of your home is the first thing people notice. Improving your landscaping, siding, roof, and lawn can boost curb appeal, increase your home's value, and improve energy efficiency.

8. Consider security upgrades. While you're making improvements, it may be a good time to update your home security system. From motion sensor lights to security cameras, security upgrades can make your home feel safer and increase its value.

FAQs about home improvement loans

What is a personal loan for home improvement?

A personal loan for home improvement is an unsecured loan you can use to fund repairs, renovations, or upgrades without putting your home or savings at risk. You receive funds upfront and repay them — along with any interest and fees — over an agreed-upon term.

How much can I borrow for a home improvement project?

The amount you can borrow depends on the loan type and lender. Payday loans are typically capped at a few hundred dollars and work well for minor repairs. Installment loans and lines of credit can provide larger amounts for bigger projects. Regardless, you should only finance what you need to keep costs manageable.

How fast can I get a personal loan for home improvement?

It depends on the lender and loan type. Direct lenders often offer a faster, more streamlined process than traditional banks — and some can fund your loan as soon as the same day.