May 15th, 2013

Financing Home Improvements: A Step by Step Guide

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**Today’s guest post is contributed by Brandon.**

Financing home improvement projects doesn’t have to be complicated. If you follow some simple steps to determine what type of program best fits your needs, you’ll be well on your way to getting your loan approved and getting your project started.

Step 1: Know Your Credit Scores

Many programs require minimum credit scores in order to qualify. If you don’t already know your scores, you can check them for free from Credit Karma .There are programs available for all credit types, from excellent to bad credit.

Step 2: Determine How Much You Need for Your Project.

This includes getting estimates from qualified contractors and determining how much cash (if any) you want to put towards the project. This will give you the final amount that you’ll need to finance.

Step 3- Narrow Down the Loan Programs That Would Best Fit That Amount.

Our research shows that most projects that are under $15,000 are best financed by 0% or low interest credit card products. Projects that are between $15,000 and $50,000 are generally a good fit for a personal or unsecured loan. Any loan amount that exceeds $50,000 is typically best financed with a home equity line of credit or a cash out refinance mortgage. You can use a simple home improvement loan calculator to run some payment scenarios to see what would best suit your budget.

Step 4- Find the Best Program.

Many contractors partner with finance companies that specialize in financing home improvement projects. Ask your contractor if they have a company to recommend or find one by researching online.

Step 5- Give Yourself Enough Time to Get the Loan Approved and Funded.

Many credit card issuers can give instant approval but it can take about a week for you to receive your card in the mail. Personal loans companies can also give you a very fast approval but it can take one to two weeks to get your loan processed. The home equity and mortgage programs not only require the most paperwork and fees, but also can take anywhere from 3-5 weeks to fund.

If you follow these simple steps to financing your home improvements you will ensure that you find the best financing program to suit your project and your family’s financial goals. Good luck!


Brandon Perry is the President of AMS Financial Solutions, Inc., a consumer finance company serving the Home Improvement, Swimming Pool, Medical & Dental, Travel, and Wedding industries since 2004. AMS services consumers direct and partner with thousands of service providers in these verticals to offer financing programs to their customers.

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Disclaimer: All information posted to this site was accurate at the time of its initial publication. Efforts have been made to keep the content up to date and accurate. However, Credit Karma does not make any guarantees about the accuracy or completeness of the information provided. For complete details of any products mentioned, visit bank or issuer website.


  1. Take out loans for a home improvement project? I realize this blog is about credit services, but honestly, unless you’re a professional real estate investor, home improvement projects should be funded with savings. If you’re managing your income properly, there should be plenty of money available for projects like this. You just have to prioritize where you invest your savings.

    Sure, there may be some tax deductions you can take (e.g. energy star windows) or capital writedowns when you sell your house, but financing improvements for those small, future benefits rarely makes sense from a personal finance perspective.

    J at 4:28 pm on May 16, 2013
  2. Hi! Thanks a lot for sharing these home improvement financing tips. Also the step by step guide is pretty useful and informative.Thanks for the wonderful resource again. Cheers!

    natural stone supply at 2:44 am on June 11, 2013
  3. Maintaining your home with beautiful look is a best part in your life, we are lucky to have several home improvements services in around the world. The above step by step procedure is looking very useful.

    martinblenner at 5:46 am on July 10, 2013
  4. Hi! thanks for the tips. I tend to have more ideas than my budget can support. One thing I learned in home improvement is to prioritize the projects. It is always smart that we look at our alternatives and figure out which idea will cost the lowest. Even if we have a meager budget, it is still possible to create something beautiful and long lasting.

    Coral Gables Locksmiths at 10:17 pm on August 11, 2013

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