NerdWallet’s picks for the best home improvement loans
Our list includes lenders offering larger loan amounts appropriate for typical home improvement projects as well as terms that allow affordable monthly payments. We also considered features like rates and funding time, plus loan requirements and options that help borrowers qualify.
LightStream: Best for overall home improvement loan
For pricey projects, LightStream offers personal loans of up to $100,00 to those who qualify. It also offers repayment plans of up to 20 years for loans that are greater than $25,000 and used for home improvement purposes.
LightStream also stands out for depositing funds quickly, charging no fees and allowing co-borrowers.
Upgrade: Best for borrowers with fair credit
Upgrade offers loan amounts from $1,000 to $50,000 and a wide variety of repayment terms. Its minimum credit score requirement of 600 is ideal for borrowers with fair credit, who can increase their odds of approval by opting for a co-signed or secured loan through Upgrade.
First Tech: Best for credit union members
One reason to consider a loan through a federal credit union: their maximum APRs are capped at 18%. In addition to offering relatively low rates, First Tech has many personal loan options to fit a variety of home improvement needs. Loan amounts range from $500 to $50,000, and terms range from 6 months to seven years.
Note that you must become a member of First Tech to qualify.
SoFi: Best for large loan amounts
SoFi offers loans up to $100,000, as well as joint loans — ideal for large, shared home improvement expenses. SoFi also stands out for offering multiple rate discounts, as well as hardship assistance for a job loss.
Upstart: Best for thin- or low-credit borrowers
Lenders typically focus a lot on credit to determine whether an applicant qualifies and for what rate. But Upstart has no minimum credit score and accepts applicants without much credit history. Instead, it considers factors like college education and work experience.
Best Egg: Best for secured loan options
A secured loan is backed by collateral, or property that the lender can take if the borrower doesn’t repay their loan. The upside of this move: Secured loans are typically easier to qualify for and may lead to lower rates or higher amounts than a borrower would have been offered for an unsecured loan.
Best Egg offers two ways to secure loans. Homeowners can use permanent home fixtures (like built-in cabinets, light fixtures and bathroom vanities) as collateral and borrow up to $50,000. Or people can borrow up to 250% of their vehicle’s value, up to $100,000.
How do home improvement loans work?
A home improvement loan is typically an unsecured personal loan that you use to cover the costs of home upgrades or repairs. They’re sometimes called home renovation loans or home remodeling loans.
Repayment
Lenders provide loans of up to $100,000 in a lump sum, which you repay in monthly installments, usually over two to 12 years. A loan with a long repayment term may have low monthly payments, but you’ll pay more interest over the life of that loan than one with a shorter repayment term.
Once approved, you may receive your loan within one to two days. Missed or late loan payments will negatively impact your credit, but you won’t risk losing your home.
Interest rates
Annual percentage rates range from about 7% to 36%. APRs represent the entire cost of the loan, including fees the lender may charge. Lenders decide your rate on the loan primarily by evaluating your credit score, credit history and debt-to-income ratio.
Some lenders let you add a co-signer or co-borrower to your application. Adding someone with better credit or higher income to the loan application may reduce your annual percentage rate (APR) or increase the amount you can borrow.
» MORE: Current average personal loan rates
Pros and cons of home improvement loans
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Fixed payments.
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Fast funding, typically within a few days.
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Potentially large loan amounts.
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No collateral usually required.
Pros
- Fixed payments. This means you know exactly how much you need to pay each month and for how long. That consistency can help you budget for payments.
- Fast funding. Most lenders approve and fund loans within a week, and several do so within a day or two. This timing could be crucial if you need to quickly fund an emergency repair or replacement.
- Potentially large loan amounts. Home improvement projects come with hefty price tags. Personal loans can help cover the costs with amounts up to $100,000 from some lenders (though many borrowers qualify for less depending on credit and income).
- No collateral usually required. Most personal loans are unsecured, meaning that if you miss payments, your credit may be damaged but no property will be seized.
Cons
- Potentially high interest rates. Interest rates on personal loans range from 7% to 36%, with the lowest rates going only to applicants with good or excellent credit.
- Potentially high payments. Personal loan terms are typically around two to seven years. Pair the higher interest with shorter terms, and monthly payments are typically more expensive.
- No tax deductions. Interest paid on a personal loan is not tax-deductible as it can be with other types of financing, including home equity loans.
Where to get a personal loan for home improvements
- Online lenders. These lenders offer a convenient way to find and compare personal loans online.
- Credit unions. Personal loans from credit unions may have lower annual percentage rates and flexible terms for their members.
- Banks. Some national banks offer personal loans with competitive rates and in-person support.
» MORE: Where to get a personal loan
How to get a home improvement loan
- Get a firm cost estimate. Identify the size of your project and get quotes or estimates to determine how much you need to borrow. Knowing the total cost can help you decide which financing option is best.
- Compare options. Compare the best home improvement lenders against other financing options, like credit cards and home equity financing. You’re looking for the one that costs the least in total interest, has affordable monthly payments and fits your project cost and timeline.
- Check your rate and monthly payments. Many online lenders and some banks let borrowers pre-qualify to see potential personal loan offers before applying. Pre-qualifying involves a soft credit pull that doesn’t impact your score.
- Prepare documents. Once you’ve chosen a lender, gather the documents you’ll need to apply, which may include W-2s, pay stubs, proof of address and financial information.
- Apply. You may have to apply in person at smaller banks and credit unions, but larger ones and online lenders have online applications. Many lenders can give you a decision the same day you apply. After that, expect to see the funds in your bank account in less than a week.
» MORE: Personal loan application requirements
Home improvement loan calculator
Estimated monthly payment
$309.92
Total interest over 3 years
$1,156.95
Total loan payment
$11,156.95
PRINCIPAL AMOUNT — $10,000TOTAL INTEREST PAID — $1,156.95
Costs of home improvement projects
Unsecured loans can cover almost any home improvement project. How much you need varies based on your location, home size and how extensive your plans are.
Here are some common projects and how much you could pay for each, based on the most recent cost estimates available:
Sources: Remodeling 2025 Cost vs Value Report, EnergySage, Angi.
Home improvement loans vs. equity financing
Unsecured personal loans, or home improvement loans, are far from the only way to fund a project. You may also consider tapping your home’s equity, which is its value minus what you owe.
That equity serves as collateral, meaning that if you don’t repay, the lender could take your house. In turn for that risk, you may be more likely to qualify or secure lower rates than you would for a personal loan.
Also note that this type of financing can take longer to fund, because it typically requires a home appraisal.
Here are two types of equity financing:
Home equity loan
Home equity loans work similarly to personal loans: borrowers receive the funds in a lump sum, and the loans typically have fixed interest rates. You repay this loan in monthly installments over a term as long as 30 years.
Because you’re offering your home as collateral, home equity loans often have lower rates and longer repayment terms than personal loans.
» Dive deeper: Personal loan vs. home equity loan
Home equity line of credit
A HELOC is pretty different from both personal loans and home equity loans. Rather than a fixed amount of money, a HELOC is an open credit line that you draw on as needed, for about 10 years.
Unlike personal and equity loans, interest rates are variable, meaning monthly payments fluctuate.
How do I choose the right home improvement financing option?
“Sometimes, the project itself will give one type of financing an edge. When I needed a new roof on my house, I went with a personal loan because that repair wouldn’t wait, and borrowing against my home equity would have taken way too long. But if you’re looking to borrow a larger amount for a major renovation, or you want a longer time to pay back the loan, borrowing against your home equity may make more sense.”
Other types of home improvement financing
Government assistance
Some government programs can help pay for a home renovation. The Federal Housing Administration has two programs: Title I loans and Energy Efficient Mortgages. You can search for a “Title I Property Improvement” lender in your state on the U.S. Department of Housing and Urban Development website.
The Inflation Reduction Act of 2022, or IRA, allows homeowners to get tax credits for energy-efficient updates, like new doors, windows, insulation, heat pumps and air conditioners. The Energy Efficient Home Improvement Credit and Residential Clean Energy Credit are listed on the IRS website.
When it’s best: Consider applying if your project and finances meet the criteria outlined by these programs. They can help make upgrades more affordable.
» MORE: Home improvement tax credits for energy-saving updates
Cash-out refinancing
A cash-out refinance is a new home loan for more than what you owe on your house. You can use this new loan to pay off your original mortgage, then use the extra cash for your renovation.
When it’s best: Consider this option if mortgage rates are lower than the one you’re paying now.
Credit card
Strategic use of a credit card can cover the cost of your upgrades. Home improvement store cards can earn cash back as you upgrade, while a card with a 0% introductory APR can cover short-term home renovations.
When it’s best: Use a credit card for projects small enough that you won’t max it out. You should typically aim to pay your full balance every month. You’ll need good or excellent credit (690 credit score or higher) to qualify for a zero-interest or rewards card.
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