8 Best Home Improvement Loans for 2025

Crediful
• 14 min read

Home repairs and renovations aren’t something you can ignore for long. A minor leak or outdated electrical system can turn into a much bigger, more expensive problem if left unaddressed. But not everyone has the cash on hand to cover unexpected home improvements.

That’s where home improvement loans come in. Whether you’re updating a kitchen, fixing a roof, or making your home more energy-efficient, the right loan can help you cover costs without draining your savings.

The best home improvement loans offer competitive interest rates, flexible repayment terms, and a smooth application process, making them a practical choice for homeowners looking to invest in their property.

8 Best Home Improvement Loans

We’ve combed through the plethora of loans specifically designed for home renovations and came up with our top picks.

1. SoFi

SoFi logo
Crediful’s rating
Learn More

SoFi offers home improvement loans with competitive rates, no fees, and a fully online application process. Borrowers can check their rates in minutes without impacting their credit score, making it an easy way to explore financing options.

With flexible loan amounts and fixed repayment terms, SoFi provides a straightforward solution for homeowners looking to fund renovations.

No collateral is required, and there are no hidden fees, making it a hassle-free option for qualified borrowers.

Key Features

  • Loan amounts: $5,000 to $100,000
  • Repayment terms: 2 to 7 years
  • Interest rates: Fixed rates with competitive APRs
  • No collateral required: Unsecured loans, so your home isn’t at risk
  • No fees: No origination, prepayment, or late fees
  • Fast online application: Get a decision quickly and check rates with a soft credit pull

What to Consider

  • Good credit required: SoFi’s best rates are reserved for borrowers with strong credit histories
  • Slower funding time: It can take up to a week to receive funds, while some lenders offer next-day funding
  • No direct-to-contractor payments: Borrowers receive funds directly, requiring them to manage payments to contractors

SoFi is ideal for homeowners with good credit who want a fee-free loan with a seamless online experience.

2. Upgrade

Upgrade logo
Crediful’s rating
Learn More

Upgrade offers home improvement loans with fixed interest rates, no prepayment penalties, and a simple online application process. Designed for borrowers with fair to good credit, Upgrade provides fast funding and flexible repayment terms.

With loan amounts up to $50,000, Upgrade is a good option for homeowners who need financing for renovations but don’t want to use their home as collateral. Borrowers can check their rates with a soft credit pull before applying.

Key Features

  • Loan amounts: $1,000 to $50,000
  • Repayment terms: 2 to 7 years
  • Interest rates: Fixed APRs with competitive rates for qualified borrowers
  • No collateral required: Unsecured personal loans for home improvements
  • Fast funding: Borrowers may receive funds as soon as the next business day

What to Consider

  • Origination fees: Fees range from 1.85% to 9.99% of the loan amount
  • Higher rates for lower credit scores: Borrowers with fair credit may face higher APRs
  • No direct payments to contractors: Loan funds are sent to the borrower, requiring them to manage payments

Upgrade is a solid choice for homeowners who want a quick, unsecured loan with flexible terms. While origination fees apply, the fast funding and simple application process make it a convenient option.

3. Prosper

Prosper logo
Crediful’s rating
Learn More

Prosper offers home improvement loans through its peer-to-peer lending platform, connecting borrowers with investors willing to fund their projects.

The application process is simple, and borrowers can check their rates with a soft credit pull before committing.

With loan amounts up to $40,000, Prosper is a good option for mid-sized renovations. No collateral is required, but borrowers should be aware of origination fees and higher rates for lower credit scores.

Key Features

  • Loan amounts: $2,000 to $40,000
  • Repayment terms: 3 to 5 years
  • Interest rates: Fixed APRs based on creditworthiness
  • No collateral required: Unsecured loans, so your home isn’t at risk
  • Fast application process: Pre-qualify online with a soft credit check

What to Consider

  • Origination fees: Charges range from 2.41% to 5% of the loan amount
  • Good credit preferred: A minimum credit score of 640 is typically required
  • Higher rates for lower credit scores: Borrowers with weaker credit may receive less favorable terms

Prosper is a solid choice for homeowners who want a quick, unsecured loan with a peer-to-peer lending structure. However, origination fees and credit score requirements may limit eligibility for some borrowers.

4. LightStream

LightStream logo
Crediful’s rating
Learn More

LightStream, a division of Truist Bank, offers home improvement loans with low interest rates, no fees, and flexible repayment terms. Known for its Rate Beat Program, LightStream guarantees to beat any competitor’s rate by 0.10% for qualifying borrowers.

With high loan amounts and same-day funding available, LightStream is a strong option for homeowners planning major renovations. However, borrowers need a strong credit history to qualify for the best rates.

Key Features

  • Loan amounts: $5,000 to $100,000
  • Repayment terms: 2 to 12 years
  • Interest rates: Fixed APRs with competitive low rates
  • No fees: No origination, late payment, or prepayment penalties
  • Fast funding: Same-day funding available for approved loans
  • Rate Beat Program: Will beat a competitor’s rate by 0.10% if eligible

What to Consider

  • Good to excellent credit required: Borrowers with lower credit scores may not qualify
  • No pre-qualification option: A hard credit check is required to apply
  • Funds deposited directly to borrower: Loan proceeds are not paid directly to contractors

LightStream is a great choice for homeowners with strong credit who want a high loan amount, competitive rates, and fee-free financing. With same-day funding and long repayment terms, it’s ideal for both small upgrades and large renovations.

5. Upstart

Upstart logo
Crediful’s rating
Learn More

Upstart is an AI-driven lender that considers more than just credit scores when evaluating loan applications. By factoring in education, employment history, and income, Upstart provides home improvement loans to borrowers who might not qualify with traditional lenders.

With a fast online application and next-day funding, Upstart is a good option for homeowners looking for quick financing. However, borrowers with lower credit scores may face higher interest rates.

Key Features

  • Loan amounts: $1,000 to $50,000
  • Repayment terms: 3 to 7 years
  • Interest rates: Fixed APRs based on credit and other factors
  • No collateral required: Unsecured personal loans
  • Fast funding: Approved borrowers can receive funds as soon as the next business day

What to Consider

  • Higher rates for lower credit scores: Borrowers with limited credit history may receive higher APRs
  • Origination fees: Fees range from 0% to 12% of the loan amount
  • Limited flexibility: No option to change payment due dates once the loan is funded

Upstart is a solid choice for homeowners with a strong income but limited credit history. While origination fees can be high, its AI-driven approval process makes it easier for nontraditional borrowers to qualify.

6. Discover

Discover logo
Crediful’s rating
Learn More

Discover offers personal loans for home improvements with no fees, fixed interest rates, and a simple online application process. Borrowers can check their rates with a soft credit pull and receive funds as soon as the next business day.

With loan amounts up to $40,000 and no origination fees, Discover is a strong choice for homeowners who want straightforward financing. However, a strong credit score is required to qualify for the best rates.

Key Features

  • Loan amounts: $2,500 to $40,000
  • Repayment terms: 3 to 7 years
  • Interest rates: Fixed APRs based on creditworthiness
  • No fees: No origination, late payment, or prepayment fees
  • Fast funding: Funds may be available as soon as the next business day

What to Consider

  • Good to excellent credit required: Borrowers need a strong credit profile to qualify
  • Lower loan maximum: Some competitors offer higher loan amounts for large renovations
  • No co-signers allowed: Borrowers must qualify on their own

Discover is a great option for homeowners who want a no-fee personal loan with competitive rates. While it requires a solid credit history, the fast funding and lack of fees make it a hassle-free way to finance home improvements.

7. PenFed Credit Union

PenFed Credit Union logo
Crediful’s rating
Learn More

PenFed Credit Union offers personal loans for home improvements with competitive rates, no origination fees, and flexible repayment terms. Unlike many credit unions, PenFed allows non-members to apply, though membership is required to receive loan funds.

With loan amounts up to $50,000 and fixed monthly payments, PenFed is a strong choice for homeowners looking for a straightforward financing option. However, the best rates are reserved for borrowers with excellent credit.

Key Features

  • Loan amounts: $600 to $50,000
  • Repayment terms: 1 to 5 years
  • Interest rates: Fixed APRs based on creditworthiness
  • No fees: No origination, prepayment, or late fees
  • Membership required: Non-members can apply, but must join PenFed to receive funds

What to Consider

  • Best rates for excellent credit: Borrowers with lower credit scores may receive higher APRs
  • Shorter repayment terms: Maximum loan term is 5 years, shorter than some competitors
  • Membership step required: Borrowers must become PenFed members before loan funds are disbursed

PenFed is a great option for homeowners seeking a no-fee loan with competitive rates, especially those who already bank with the credit union. While membership is required to finalize the loan, the application process is open to all borrowers.

8. Wells Fargo

Wells Fargo logo
Crediful’s rating
Learn More

Wells Fargo offers personal loans that can be used for home improvements, with competitive rates and no origination fees for qualifying borrowers. With thousands of branches nationwide, customers have the option to apply in person or manage their loans online.

While Wells Fargo provides larger loan amounts and flexible repayment terms, their best rates are typically reserved for existing customers.

Additionally, borrowers who are not already account holders may have to visit a branch to complete the application process.

Key Features

  • Loan amounts: $3,000 to $100,000
  • Repayment terms: 1 to 7 years
  • Interest rates: Fixed APRs based on credit history
  • No origination fees: No upfront costs for unsecured loans
  • Fast funding: Approved borrowers may receive funds as soon as the next business day

What to Consider

  • Best rates for existing customers: Non-customers may receive higher rates or need to apply in person
  • No online applications for non-customers: New borrowers must visit a branch to complete the process
  • Credit requirements: Higher credit scores are needed to qualify for the most competitive rates

Wells Fargo is a strong choice for homeowners who want a high loan amount with no origination fees. However, existing customers will have an easier application process and access to the best rates.

home improvement

How to Get a Home Improvement Loan

Financing a home renovation can feel overwhelming, but breaking it down into simple steps makes the process more manageable. Here’s what you need to do to secure a home improvement loan.

Assess Your Budget and Needs

Before applying for a loan, determine how much money your home improvement project requires. Get estimates from contractors, factor in unexpected costs, and decide how much you can afford in monthly payments. Borrowing too much could stretch your budget thin, while borrowing too little may leave your project unfinished.

Compare Loan Options

Not all home improvement loans are the same. Compare interest rates, repayment terms, and fees across multiple online lenders. Look at personal loans, home equity loans, and HELOCs to see which option best fits your situation. The goal is to find a loan with low costs and a repayment plan that works for you.

Check Your Credit Score

Your credit score plays a big role in the loan terms you’ll receive. A higher score can unlock better interest rates and loan terms. If your credit isn’t where you’d like it to be, consider improving it before applying. Some lenders offer loans for fair or bad credit, but these often come with higher interest rates.

Gather Required Documents

Lenders will ask for financial details to assess your eligibility. Be prepared with proof of income, tax returns, credit history, and identification. Having these documents ready speeds up the approval process and reduces the chances of delays.

Apply for a Loan

Most lenders offer online applications that take just a few minutes to complete. Some conduct a soft credit check upfront, so you can see estimated rates without impacting your score. If you’re applying through a credit union or a traditional bank, you may need to visit a branch.

Receive and Use Funds

Once you’re approved and sign the loan agreement, the lender will deposit the funds into your account. Some lenders offer same-day or next-day funding, while others take a few business days. If your loan is structured to pay your contractor directly, funds may be disbursed in stages based on project milestones.

Taking the time to compare options and understand your financing needs can help you secure a loan that fits your budget and timeline.

How to Compare Home Improvement Loans

Choosing the right home improvement loan comes down to finding the best mix of cost, flexibility, and convenience. Here’s what to consider before making a decision.

Annual Percentage Rates (APRs)

The APR represents the total cost of borrowing, including interest and fees. A lower APR means you’ll pay less over time. Compare rates across multiple lenders to ensure you’re getting the best deal based on your credit profile. Some lenders offer rate discounts if you set up automatic payments.

Loan Amounts

Make sure the lender offers enough to fully cover your renovation costs. Some lenders cap personal loans at $35,000 or $50,000, while others go up to $100,000. If your project is small, you don’t want to borrow more than you need, but if it’s a major renovation, a lender with higher loan limits may be a better fit.

Repayment Terms

Longer repayment terms lower your monthly payment, but increase the total interest paid over time. Shorter terms reduce interest costs but come with higher monthly payments. Find a balance between affordability and long-term savings that works with your budget.

Fees & Penalties

Check for origination fees, which can range from 1% to 10% of the loan amount. Some lenders charge late payment penalties, while others have no fees at all. Avoid loans with high hidden costs, and always read the fine print before committing.

Funding Speed

If you need money quickly, look for lenders offering same-day or next-day funding. Some loans take a few days to process, while others—especially home equity loans—may take weeks. If your project is urgent, a lender with fast approval and funding is the best option.

Customer Service

If you run into issues with your loan, strong customer service can make a big difference. Check online reviews to see how lenders handle customer concerns, especially regarding billing, payment flexibility, and loan modifications. A lender with responsive support can save you headaches down the line.

Comparing these factors will help you find a loan that fits your financial situation and renovation needs without adding unnecessary costs or complications.

Types of Home Improvement Loans

Home improvement loans come in several forms, each with its own benefits and drawbacks. The right option depends on your credit score, home equity, loan amount, and how quickly you need the funds. Here’s a breakdown of the most common types.

Unsecured Personal Loans

Personal loans don’t require collateral, making them a fast and flexible option for home improvements. Many lenders offer same-day or next-day funding with fixed interest rates and predictable monthly payments. However, since these loans aren’t backed by your home, they often come with higher interest rates than secured loans.

Home Equity Loans

A home equity loan allows you to borrow a lump sum against the value of your home. These loans have lower interest rates than personal loans because they’re secured by your home. However, if you fail to make payments, the lender can foreclose on your property. This option is best for homeowners with significant equity who want a fixed-rate loan.

Home Equity Line of Credit (HELOCs)

A HELOC works like a credit card, allowing you to borrow as needed instead of taking a lump sum upfront. It’s secured by your home, so interest rates are lower than personal loans. HELOCs offer flexibility for ongoing renovations, but they have variable interest rates, meaning your payments can fluctuate over time.

Cash-Out Refinancing

Cash-out refinancing replaces your existing mortgage with a new, larger loan. You receive the difference in cash, which you can use for home improvements. This option often provides lower interest rates than personal loans or credit cards, but it extends your mortgage term and increases the amount you owe on your home.

FHA 203(k) Loans

FHA 203(k) loans are government-backed loans designed for major home renovations. These loans are ideal for fixer-uppers, allowing borrowers to finance both the purchase and renovation costs into a single mortgage. While they offer lower interest rates, they require more paperwork and can take longer to process.

Choosing the right home improvement loan depends on your financial situation and project scope. If you need quick funding, a personal loan or HELOC may be best, while homeowners with equity might benefit from a home equity loan or cash-out refinance.

Final Thoughts

Finding the right home improvement loan comes down to balancing affordability, loan terms, and how quickly you need the funds. Personal loans are a solid choice for quick financing without using your home as collateral, while home equity loans and HELOCs offer lower rates for homeowners with built-up equity. If you’re tackling a large renovation, cash-out refinancing or an FHA 203(k) loan may provide the best long-term value.

Before applying, compare multiple lenders, check your credit score, and calculate how much you can comfortably repay each month. The best loan is one that helps you complete your renovation without straining your budget. By taking the time to explore your options, you can secure the right financing for your home upgrades while keeping borrowing costs as low as possible.

Crediful
Meet the author
Crediful

Crediful is dedicated to making personal finance simple. Our team of experts provides clear, practical advice on budgeting, credit, saving, investing, and more to help you make smart financial decisions.

You may also like