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Best Home Improvement Loans for July 2024

From updating your kitchen to adding a home office or remodeling the bathroom, personal home improvement loans provide the cash to make your living space fit your needs.
Betsalel CohenJul 1, 2024
Editor’s Note
Advertising Disclosures

At, we strive to help you make financial decisions with confidence. While many of the products reviewed are from our Service Providers, including those with which we are affiliated and those that compensate us, our evaluations are never influenced by them.

Compare Home Improvement Loans

Best for borrowers with fair credit
Achieve Logo
8.99 - 35.99%%
$5K - $50K
620 rating
Best for low rates
light stream logo
2.49 - 19.99% with AutoPay
$5K - $100K
660 rating
Best for subprime credit card consolidation
Happy Money Logo
5.99 - 24.99%
$5K - $40K Loans are not currently offered in MA MS NE and NV.
640 rating
Best for Large personal loans
sofi logo v1
7.99% to 23.68% APR (with .25 % auto pay discount)
$5K - $100K
None listed rating
Best for invitation only
marcus logo
6.99 - 24.74%
$3.5K - $40K
not disclosed rating
Best for Excellent credit
discover logo
6.99 - 24.99%
$2.5K - $35K
660 rating
Fast funding
upstart logo
6.5 to 35.99%. Average 5- year loan has an APR of 26.57%
$1K - $50K Varies by state
No minimum rating
Best for borrowers with poor credit
9.95% - 35.99%
$2K - $35K
600 rating

Home improvement loans: unlock your home's potential 

Are you thinking of improving your kitchen, adding a home office, or remodeling your bathroom? If so, personal home improvement loans can help. These loans can give you the money you need to transform your living space and make it work better for you.

What are home improvement loans? 

Home improvement loans are a type of loan that provides funds for renovations and remodeling projects. The funds can be used flexibly based on your specific renovation goals and needs. Personal loans for home improvements are unsecured, meaning you don't have to put your home up as collateral. They are generally repaid over 2–7 years.

These loans allow you to borrow a lump sum to cover costs such as materials (flooring, counters, fixtures, etc.), labor, permits, and other fees.

Common uses include:

• Kitchen remodels

  • Bathroom renovations 
  • Home additions
  • Exterior upgrades like new roofing, windows, or siding
  • Flooring replacements
  • And other major home improvement projects

»Learn more: How do personal loans work?

Benefits of personal loans for home improvements 

Getting a personal loan for home improvements has some benefits over other ways to pay for them:

  1. You can pick a loan amount and repayment plan that fits your budget instead of being limited by the value of your home.
  2. You don't need to put your home on the line because these loans don't require collateral.
  3. You can use the money for any home improvement project you want. 
  4. Personal loans allow you to access money faster than other options, such as home equity loans, cash-out refinances, or construction loans.

Pros and cons of home improvement personal loans


Funds are flexible

No home equity required

Fixed, predictable payments


Usually higher interest rates than secured options 

Credit score might be impacted during repayment

Risk of over-borrowing or underestimating costs

»Learn more: What credit score is needed for a personal loan?

Qualifying for a home improvement loan

To qualify for a personal home improvement loan, lenders will review several factors, including:

  • Credit Score: You need a score of around 620–680 or higher for loan approval. A score of 760 or above gets you the best rates.
  • Income and Employment: Stable income from a job or other sources is needed to show you can repay the loan.
  • Monthly Debt Payments: Lenders compare your debts to your income (debt-to-income or DTI ratio). A DTI below 35–40% is preferred.
  • Credit History: A long history, a mix of account types, and timely payments help with approval.

You'll need to provide documentation to verify your financial information, such as:

  • Pay stubs or W2s to confirm income
  • Tax returns 
  • Bank statements
  • Proof of residence
  • Government-issued ID  

Having a strong income, low debt, and an excellent credit profile increases your chances of approval at a competitive interest rate.

»Learn more:: How to get prequalified for a home improvement loan 

How to get a home improvement loan 

Getting a personal loan for your renovation is a straightforward process, especially with online lenders. Here's a typical step-by-step flow:

  1. Check Your Credit Score: Understand your creditworthiness, as it affects your loan terms.
  2. Budget: Determine how much money you need for your project to avoid borrowing too much or too little.
  3. Shop Around: Compare different lenders to find the best interest rates and loan terms.
  4. Get Prequalified: This process gives you a glimpse of the potential loan terms without impacting your credit score.
  5. Apply: Have your documents ready—ID, proof of income, etc.—and fill out the application accurately.
  6. Understand the Loan Agreement: Read and make sure you comprehend all parts of the agreement, focusing on interest rates, repayment terms, and any fees involved

The loan process is quick with online lenders. It usually takes 2–5 days from the time you submit the application to when you get the money. This means you can get the money for your renovation fast.

»Get a quote now:: Get prequalified for a personal loan 

3 additional tips for the application process:

  1. To get approved for a loan, make sure you have all the necessary documents ready.
  2. Be ready to explain how much money you need and what you plan to do with it.
  3. Set up automatic payments so you don't miss any, which could hurt your credit score.

Using home improvement loans wisely

Use your personal home improvement loan wisely and avoid costly surprises. Start by creating a detailed budget that accounts for the full scope of your renovation, including:

  • Materials and supplies  
  • Contractor's labor costs
  • Permit fees  
  • Potential overages due to delays or change orders

Before deciding on your budget, get quotes from several licensed and insured contractors for the project. Compare these quotes to your estimated total costs to make sure you borrow enough money to cover the entire project.

After your loan is approved, review the repayment terms and monthly payments. Make sure they fit your budget for the entire repayment period. Set aside a contingency fund, which will help cover any unexpected costs that may arise.

Smart planning and budgeting upfront can help avoid over-extending yourself with too large a loan or underestimating how much you need to borrow.

»Get a quote now:: Get prequalified for a personal loan 

Risks of personal home improvement loans 

While personal loans offer convenience for financing renovations, there are some potential risks to consider:

Higher interest rates than home equity loans. Personal loans tend to carry significantly higher APRs compared to secured options that use your home's equity as collateral. This makes the overall project more expensive over time.

Credit score negatively impacted if you miss payments: Your credit score will be impacted while repaying the loan balance. Lenders report payment activity to credit bureaus monthly. Missing any payments can severely damage your credit.  

Over-borrowing risks. It's common to underestimate the total cost of a project. People can also get carried away when choosing expensive materials and finishes. This can lead to borrowing more money than needed and paying extra interest charges.

To mitigate risks, shop around for the lowest rates based on your credit profile. Create a line-item budget and stick to it. Only borrow what you truly need for the planned scope of work.

Typical personal loan interest rates 

The interest rate on a personal home improvement loan is based on your credit score and other factors like your income and debts. Here are some typical annual percentage rates (APRs) based on credit score ranges:

Credit scoreRangeSample rates - Fixed APRYears to repay
Excellent720+Achieve: 8.17%3
Good660 - 719Achieve: 8.17%3
Fair620 - 659Lendingpoint: 19.49%5
Bad< 620OneMain Financial: 22.74%3

Source: and EvenFinancial rate table March 2024. Please note that the rates provided are solely for illustrative purposes and do not represent actual loan offers.

High credit scores and low debt-to-income ratios result in better interest rates from lenders. Shorter loan repayment periods have lower annual percentage rates (APRs).

Alternative financing options 

Personal loans are one popular option for paying for home renovations. However, there are several alternatives to consider depending on your qualifications, preferences, and project needs.

Home equity loans or lines of credit (HELOC) allow you to tap into your home's equity to access funds at relatively low-interest rates. However, your home is put up as collateral.

Cash-out refinance replaces your current mortgage with a larger loan amount and take the difference in cash to fund renovations. Again, requires enough home equity.

Government-insured rehab loans with programs like FHA 203(k) loans combine a home purchase with additional funds for renovations into one mortgage.

Credit cards for smaller upgrade projects, 0% introductory APR credit cards can provide short-term, interest-free financing if paid off during the promo period.  

Home improvement stores and contractors may offer financing options, but beware of high-interest rates and markups.

To find the right fit, compare all options based on rates, fees, repayment timelines, overall costs, and your comfort level with any collateral requirements.

»MORE: Home renovation financing options explained

Frequently Asked Questions

Can I use a home improvement loan for any renovation? 


Yes, personal home improvement loans provide flexible funds that can cover a wide variety of interior and exterior projects, including:

  • Remodeling kitchens and bathrooms

  • Building home additions or finishing basements

  • Installing new flooring, windows, or doors

  • Replacing roofing, siding, or HVAC systems

  • Converting garages or building detached structures

What are typical interest rates for home improvement loans?


Interest rates on personal home improvement loans typically range from around 6% up to 36% APR based on your credit qualifications and other factors:

  • Borrowers with excellent credit scores of 760+ tend to get the lowest rates in the 8–12% Apr range.

  • Good credit scores of 700–759 may be eligible for 12–25% APR. 

  • Those with average credit scores of around 640–699 commonly discover rates of 19–36% APR.

Having a strong credit score, a low debt-to-income ratio, shorter loan terms, and a stable source of income can potentially help secure a more favorable interest rate from lenders.

Are home equity loans better than personal loans for renovations? 


Home equity loans may be a better financing option than personal loans for homeowners who want to renovate their homes. Here are some pros and cons to consider:

Home equity loan advantages:

  • Potentially lower interest rates since the loan is secured by your home equity as collateral

  • May offer a larger lump-sum borrowing amount  

  • Interest may be tax-deductible

Home equity drawbacks:  

  • Requires having enough equity built up in your home to borrow against

  • Your home is put up as collateral, which isn't required for unsecured personal loans

  • Stricter approval requirements like maximum loan-to-value ratios  

  • In many scenarios, there are lengthier processing periods and additional charges/closing expenses.

If you don't have much home equity or don't want to use your home as collateral, personal loans are still a good way to get money for home improvements. But the interest rate will be higher.