Best Home Improvement Loans

Compare home improvement loans to finance your renovations and repairs

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Best Home Improvement Loans鈥揙ctober 2020

Lender Best For APR Range Minimum Loan Amount Maximum Loan Amount Terms Recommended Credit Score
SoFi Best Overall 5.99%鈥18.53% with autopay $5,000 $100,000 2鈥7 years 680+
Avant Best for Bad Credit 9.95%鈥35.99% $2,000 $35,000 24鈥60 months 600+
LightStream Best Loan Rates 3.99%鈥19.99% with autopay $5,000 $100,000 2鈥12 years 680+
Wells Fargo Best Brick-and-Mortar Lender 5.74%鈥20.24% with relationship discount $3,000 $100,000 12鈥84 months (12鈥36 months for loans under $5,000) 620+
Upstart Best for Borrowers With Little Credit History 7.98%鈥35.99% $1,000 $50,000 3 or 5 years 600+
USAA Best for Veterans 7.24%鈥17.65% $2,500 $5,000 12鈥84 months 600+
PenFed Credit Union Best for Small Loans 6.49%鈥17.99% $500 $20,000 6鈥60 months 580+
Peerform Best for Fair Credit 5.99%鈥29.99% $4,000 $25,000 36鈥60 months 600+
Loan amounts, APR, and repayment period may vary by loan purpose or type.

Making upgrades or the right repairs to your home can often be a wise investment, adding considerably to its resale value (not to mention its comfort, style, and looks). Unfortunately, people often can鈥檛 afford big property projects without taking a home improvement loan.

Whatever sort of task you want to tackle, it probably won鈥檛 be cheap: The average kitchen remodel in the United States costs more than $23,000. Bathroom remodels average $21,000 and up. Even a simple 16 x 20-foot wood deck could set you back more than $14,000.

If you鈥檙e looking for financing to cover home renovation or repair costs, you鈥檙e in luck. We鈥檝e done a lot of the legwork for you鈥攃omparing interest rates, fees, terms, and other factors you should consider. Here are our聽picks for the best home improvement loans currently available.

SoFi: Best Overall


Online lender SoFi offers personal loans for home improvement (among other financial products). With fixed rates starting at 5.99% and a maximum loan amount of $100,000, SoFi's financing could fit a variety of renovation jobs鈥攅ven extensive ones. In addition to its attractive interest rates and generous sums, SoFi offers borrowers the option to pre-qualify in advance, checking terms without incurring a hard credit inquiry.

  • No home equity or collateral requirements to borrow

  • Option to pause your payments temporarily if you lose your job

  • Soft credit check displays potential rates and terms before you officially apply

  • It takes a long time to receive funds鈥搇oans typically fund within a week

  • Good credit recommended to qualify

  • Better interest rates may be available elsewhere if you have excellent credit

Other important information:

  • Maximum/minimum amount you can borrow: $5,000 to $100,000 in most states
  • APR range: 5.99%鈥18.53% (with AutoPay discount)
  • Fees: None
  • Minimum recommended credit score: Reported to be 680, but not disclosed on website
  • Other qualification requirements: Credit history, income, employment
  • Repayment terms: 2鈥7 years
  • Time to receive funds: Typical funding can take up to a week (from approval to the receipt of funds).
  • Restrictions: You must be 18 or older and a U.S. citizen (or permanent resident or visa holder) to qualify for a personal loan. Mississippi residents are ineligible for a SoFi loan.

Read the full review: SoFi Personal Loans

Avant: Best for Bad Credit


If you need a personal loan for home improvement but your credit rating is less-than-stellar, Avant may be worth considering. With APRs starting at 9.95% and an administrative fee of up to 4.75%, this online lender "for middle-income borrowers" doesn鈥檛 offer the most affordable financing option for home improvements. Yet when you compare its terms to those offered by others open to subprime borrowers, Avant starts to look a lot more attractive.

  • No home equity required to qualify

  • Fast funding, potentially as soon as the next business day

  • A soft credit inquiry (with no credit score impact) tells you if you prequalify

  • An administrative fee of up to 4.75% could increase the cost of your loan

  • Lower interest rates may be available through other lenders

  • 聽Low maximum loan amount of $35,000

Other important information:

  • Maximum/minimum amount you can borrow: $2,000 to $35,000
  • APR range: 9.95%鈥35.99%
  • Fees: administration fee may be as high as 4.75%
  • Minimum recommended credit score: reported to be 580, but Avant states that most customers have a credit score between 600鈥700
  • Other qualification requirements: In addition to your creditworthiness, Avant will consider your income when you apply for financing. You must submit proof of employment and an active personal checking or savings account to borrow funds. If you鈥檙e self-employed, you鈥檒l need to submit your two most recent tax returns along with your loan application
  • Repayment terms: 24 to 60 months
  • Time to receive funds: You鈥檒l typically receive a direct deposit of your loan funds by the next business day (if your application is approved by 4:30 p.m.CT on a weekday)

Read the full review: Avant Personal Loans

LightStream: Best Loan Rates

LightStream logo

LightStream is an online lending division of Truist (a newly formed merger between SunTrust Bank and BB&T). For borrowers with good to excellent credit, annual percentage rates on home improvement loans start at 4.99% and the lender charges no fees. Well-qualified applicants may be able to borrow as much as $100,000 with no home equity requirements.

  • Low rates start at 3.99% (with AutoPay)

  • Fast funding, potentially as soon as the day you apply

  • No home equity requirements or appraisals needed

  • No pre-approval option (with soft credit pull) available

  • Tough to qualify without several years of good-to-excellent credit history

  • 3.99% APR only applies to loans between $10,000 鈥 $24,999

Other important information:

  • Maximum/minimum amount you can borrow: $5,000 to $100,000
  • APR range: 3.99%鈥16.99% (with AutoPay discount)
  • Fees: None (Note: If you are a Florida resident, a state documentary stamp tax fee may apply)
  • Minimum recommended credit score: Reported to be 680 (though not confirmed on LightStream鈥檚 website)
  • Other qualification requirements: LightStream caters to borrowers with good to excellent credit. If you have several years of credit history and a mixture of account types on your credit report (credit cards, installment loans, mortgage, etc.), you may be in luck. LightStream will also consider your ability to save, your income, and your current debts聽
  • Repayment terms: 2 to 12 years聽
  • Time to receive funds: Funds may be deposited into your bank account the same day you apply for a loan
  • Restrictions: LightStream won鈥檛 issue loans to cover education costs, to refinance existing LightStream loans, or to be used by a business.

Read the full review: LightStream Personal Loans

Wells Fargo: Best Brick-and-Mortar Lender

Wells Fargo Logo

Wells Fargo offers multiple ways to finance home improvement projects, including unsecured personal loans. If you choose an unsecured loan, you won鈥檛 need to put up any collateral, like the equity in your home, to secure financing. Wells Fargo is also a bricks-and-mortar bank, with thousands of branches around the U.S, which might appeal to those who like to discuss financing options in person, with a human.

Existing Wells Fargo customers may be able to secure a lower interest rate on their loans. If you already have a qualified personal Wells Fargo checking account (and you use it to make automatic payments), you may score a 0.25% relationship discount off your interest rate. The lender鈥檚 APR for an unsecured personal loan starts at a low 5.74% and there are no origination or prepayment fees.

  • Unsecured personal loans for home improvement available

  • Loan amounts as small as $3,000 available

  • Three application options: online, over the phone, or at a branch

  • Application process could take some time if the bank wants more documents

  • Hard credit pull may be required to learn if you qualify and discover your rate

  • Must already be a Wells Fargo customer to apply online or via phone

Other important information:

  • Maximum/minimum amount you can borrow: $3,000 to $100,000
  • APR range: 5.74%鈥20.24% (with 0.25% relationship discount)
  • Fees: Wells Fargo charges no origination fees and no prepayment penalties.
  • Minimum recommended credit score: Not disclosed, but the Wells Fargo Rate and Payment Calculator indicates that you might qualify for a loan with a credit score as low as 620
  • Other qualification requirements: Your credit, income, and expenses (aka your debt-to-income ratio) will all be assessed to determine if you鈥檙e eligible for a loan
  • Repayment terms: 12 to 84 months (12 to 36 months for loans under $5,000)
  • Time to receive funds: Once your application is approved, personal loan funds may be available by the next business day
  • Restrictions: You must either be a U.S. Citizen or Permanent Resident Alien to qualify

Read the full review: Wells Fargo Personal Loans

Upstart: Best for Borrowers With Little Credit History

Upstart Logo

Upstart takes a unique approach to lending that may help borrowers qualify for a more affordable loan, particularly borrowers without much credit history. The lending platform, founded by a group of former Google employees, has created a loan application process that considers not just your credit, but also your education and job history in determining how risky a prospect you are, and thus what sort of rate you qualify for.

Unfortunately, Upstart loans may come with an origination fee of up to 8%. This fee comes directly out of your loan before you receive the funds. On a $10,000 loan, the origination fee could be as high as $800.

  • You might qualify for a lower interest rate based on education or job history.

  • Initial soft credit pull can help you check your rate without hurting your credit.聽

  • Borrowing flexibility with loan amounts from $5,000 to $30,000 in most states

  • Origination fee of as high as 8%

  • Average APR is 15% on a 3-year loan

  • Only two repayment options available: 3 or 5 years

Other important information:

  • Maximum/minimum amount you can borrow: $1,000 to $50,000, based on credit, income, and other information considered in your loan application.
  • Typical APR range: 7.98%鈥35.99%
  • Fees: Possible origination fee of 0% to 8%. Late fees are 5% of the past due balance or $15, whichever is greater. Returned check or ACH fees are $15. There is no prepayment penalty.锘柯
  • Minimum recommended credit score: 600锘柯
  • Other qualification requirements: You must be at least 18 years old, with a valid Social Security number, and enough credit history to qualify for a FICO Score. Your debt-to-income ratio must fall within an acceptable range. Finally, your credit report cannot show any bankruptcies, currently past-due accounts, or more than six inquiries in the last six months.
  • Repayment terms: 3 or 5 years
  • Time to receive funds: Funds may be available as soon as the next business day, once you accept your loan offer or two days if you accept after 5pm EST.
  • Restrictions: Loans unavailable to residents of Iowa or West Virginia, or anyone without a U.S. residential street address (outside of the military.)

Read the full review: Upstart Personal Loans

USAA: Best Loan for Veterans


USAA was founded in 1922 and is a bank that serves the military community. The bank offers many benefits to their members, including personal loans at competitive rates. Loan amounts start at $2,500 and rates starting at 7.24%鈥攔equirements include restrictive membership requirements and the fact that you need a USAA Bank account.

  • Has one of the longest repayment terms compared to other lenders

  • Receive loan proceeds as soon as the next day

  • Rate discount for those who opt into autopay

  • Membership and USAA Bank account required for a personal loan

  • Small loan amounts compared to other lenders

  • No prequalification option

Other important information:

  • Maximum/minimum amount you can borrow: $2,500 to $5,000
  • APR range: 7.24%鈥17.65%
  • Fees: No application or early payment penalties
  • Minimum recommended credit score: 600
  • Other qualification requirements: Need a loan term of 48 months if applying for a loan of $5,000
  • Repayment terms: 12 to 84 months
  • Time to receive funds: Within 24 hours to your USAA Bank account
  • Restrictions: Need to become a member and open a USAA Bank account to receive a personal loan

Read the full review: USAA Personal Loans

PenFed Credit Union: Best for Small Loans


PenFed Credit Union offers personal loans as low as $500. Rates start at 6.49% with no origination fees. Applicants need to be a member of the credit union鈥攋oining the National Military Family Organization or the Voices for America's Troops for $17 each will suffice.

  • Offers competitive rates for those who don鈥檛 have stellar credit

  • Applicants can take out lower personal loan amounts

  • No origination fees or prepayment penalties

  • Borrowers need to meet membership requirements to apply for a loan

  • No prequalification option available

  • Maximum loan amount is lower compared to other lenders

Other important information:

  • Maximum/minimum amount you can borrow: $500 to $20,000
  • APR range: 6.49%鈥17.99%
  • Fees: None
  • Minimum recommended credit score: 580
  • Other qualification requirements: PenFed will take your income, debts and credit history into consideration, including your co-borrower鈥檚 if submitting a joint application.聽聽聽
  • Repayment terms: 6 to 60 months
  • Time to receive funds: Could be as fast as the next business day
  • Restrictions: Borrowers need to become a member of the credit union

Read the full review: PenFed Federal Credit Union Personal Loans

Peerform: Best for Fair Credit


Peerform is a peer-to-peer lending platform offering competitive loan rates for those with credit scores as low as 600. Origination fees range from 1% to 5% and loan amounts start at $4,000.

  • Peerform doesn鈥檛 charge a prepayment penalty

  • Borrowers with a short credit history may qualify for a loan

  • Prequalification option available

  • The lender charges origination and late fees

  • At $4,000, the minimum loan amount is higher compared to other lenders

  • No cosigner option available

Other important information:

  • Maximum/minimum amount you can borrow: $4,000 to $25,000
  • APR range: 5.99%鈥29.99%
  • Fees: 1% to 5% origination fee; $15 late fee: $15 returned check fee
  • Minimum recommended credit score: 600
  • Other qualification requirements: Need to have at least one year of credit history without delinquencies聽
  • Repayment terms: 36 to 60 months
  • Time to receive funds: Within three business days once application is finalized
  • Restrictions: Borrowers cannot refinance a Peerform loan

Read the full review: Peerform Personal Loans

How Do Home Improvement Loans Work?

The term home improvement loan can describe a few different financial products. Personal loans for home improvement (secured and unsecured), home equity loans, and home equity lines of credit are three popular options.

Though all three of these loans have different features, they also have something in common. If you qualify for financing, a lender will lend you the money you can use toward a home improvement or repair project. In exchange, you鈥檒l repay the money you borrowed, along with interest and possibly fees, over time.

Many home improvement loans are reported to the three credit bureaus. It鈥檚 important that you consistently make your payments on time if you want to protect your credit scores.聽And doing so can help them, of course.

Once you decide to borrow money for home improvements, there are numerous lenders who may be able to help you: online lenders, banks, and credit unions.

Are Home Improvement Loans Tax Deductible?

The Tax Cuts and Jobs Act changed many of the deductions that were once available to taxpayers. Yet, according to the IRS, the interest paid on home equity loans, home equity lines of credit, and second mortgages may still be deducted from your taxes in many cases.

To deduct loan interest from your taxes, the funds you borrowed must have been used to 鈥渂uild or substantially improve鈥 the home that secures the loan. All the loans described above are secured loans.

Therefore, if you use an unsecured loan to fund your home renovation, you might not be able to deduct the interest you pay.锘 Confirm your situation with an accountant, tax attorney, or other tax advisor.

Can I Borrow More On My Mortgage for Home Improvement?

A mortgage is a type of installment loan. Unlike revolving credit cards and credit lines that let you borrow money, pay it back, and borrow again, an installment loan is issued in a lump sum. You can鈥檛 go back to your lender and ask for more money on your existing mortgage鈥攆or home improvements or for anything else.

You can, however, consider a cash-out refinance. With a cash-out refi, you apply for and (if approved) take out a new loan to pay off your existing mortgage. Assuming the equity in your home has increased, you may walk away from the closing table with some extra funds in your pocket.

Imagine you owe $150,000 on a home that鈥檚 worth $250,000. If you have good credit and can satisfy a lender鈥檚 other requirements (income, employment, debt, etc.), you might be able to borrow $200,000 in a cash-out refinance. Once your existing mortgage of $150,000 is paid off, you could use the extra $50,000 toward your home improvement project.

Note: Refinancing your mortgage isn鈥檛 always a great idea, so weigh the pros and cons before taking this step.

The Bottom Line

Terms and conditions of home improvement loans vary a great deal, depending not only on the lender, but on the borrower's credit score and history, and the sums of money involved. No matter what sort of financial shape you're in, there's probably financing available to you. But, regardless of which type of loan you鈥檙e considering and what type of lender you want to work with, shopping around will help you make sure that you鈥檙e getting the best rate and terms on your home improvement loan.


Investopedia is dedicated to providing consumers with unbiased, comprehensive reviews of personal loan lenders for all borrowing needs. We collected over twenty five data points across more than fifty lenders including interest rates, fees, loan amounts and repayment terms to ensure that our content helps users make the right borrowing decision for their needs.

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