How to borrow for home improvements

How to borrow for home improvements

author: Rachel

By Rachel

Thinking of doing up your home? Well there are several ways you can pay for home improvements.

Perhaps the most obvious is to save the money you need. This can take time, but it means you know exactly how much you have to spend – and you won’t be charged interest for spending it.

But then it all depends on the cost of the home improvement project you have in mind. If you’re planning an extension, a conservatory or a new kitchen or bathroom, these projects can be pricey. So, if you’re considering borrowing to fund your renovations, check out your options:


If you own your home, you could consider extending your mortgage to pay for your home improvements. For example, if your current mortgage has £150,000 outstanding, you could remortgage for £160,000 and use the additional money to fund your plans.

If this is the route you prefer, be aware that additional credit and affordability checks may be requested by your mortgage provider. Plus, remortgaging will alter your LTV, and the interest you’re charged could go up and make your monthly payments higher.

Secured loan

For homeowners where remortgaging isn’t an option, perhaps because there’s a while to wait until their current deal is up, a secured loan could be an option.

A secured loan is also known as a homeowner loan or second charge mortgage. It provides you with a lump sum of cash you pay back in fixed instalments with interest for a term that usually lasts several years. The money is secured against your home, providing security for the lender. This means you can usually borrow more than with a type of unsecured credit.

Personal loan

If you’re not comfortable securing a loan to your home, you could consider an unsecured personal loan instead. Unlike a secured loan, a personal loan doesn’t use your home as security.

This can mean that you can borrow less, the interest is higher and the term is shorter than it would be with a secured loan, to reduce the risk the lender is taking.

Credit card

If you’re planning a small home improvement project, a credit card could be an option. It can help you break up the cost of pricey purchases like furniture into manageable sums. Plus, if your purchase is worth more than £100, paying with a credit card protects you under Section 75. Just be sure to always make at least your minimum payment on time each month to avoid damage to your credit history.

If you do want to borrow money to pay for your home improvements, do your sums and carefully check you can afford your monthly repayments. 

Disclaimer: All information and links are correct at the time of publishing.

author: Rachel

By Rachel

How to borrow for home improvements How to borrow for home improvements