Should You Take a Loan for Home Maintenance/Improvement?

Home maintenance and improvement is one of the top priorities of every homeowner. Rightly so, such projects not only keep the building in good shape but also increase its value. Accordingly, most homeowners save towards such projects. That notwithstanding, some home components, systems, or appliances may need emergency maintenance due to the sudden breakdown.

As an HVAC technician puts it “If equipment like the HVAC system breaks down, you cannot wait until your general maintenance schedule to fix it”. “You will need to fix it as quickly as possible for a comfortable environment”. “With a click on homeowners around Dallas, Texas can have their HVAC repaired and installed without stress” he added.

That aside, the current high cost of goods and services can affect your maintenance savings making it insufficient to cover the proposed projects. In such circumstances, you may need to find money elsewhere to add up. But is borrowing money for home improvement or maintenance worth it? Should it even be an option? 

Types of loans for home improvement 

Homeowners who don’t have the financial muscles for a home improvement project can secure a loan for it. There are several home improvement loan options and you just need to meet the terms and requirements for the loan. The options include

Personal loan

Home improvement loan can come in the form of a personal loan and its meant solely for home improvement or maintenance. Homeowners seeking to maintain or renovate their homes but don’t have the financial capacity can rely on this loan for the project.  

Personal home improvement loans come with a fixed interest rate and a payment period. However, the rate and terms differ from one lender to the other. Being an unsecured loan, you don’t need collateral to secure the loan. This makes the interest rate higher than other loans. Note that you must have a better credit score to secure a personal loan for home improvement.

Home Equity Loans

With a home equity loan, a homeowner can borrow money against the equity of their home. That is, the equity of your home serves as collateral for the lender. Home equity loans come with a fixed payment duration and fixed interest rate, so you are assured of it being the same throughout the loan period. 

Home Equity Lines of Credit (HELOCs)

A HELOC is a line of credit offered to homeowners to draw from when needed. Meaning, you can have ongoing access to funds subject to the equity you’ve built in your home. So, it’s comparable to a credit card, but your home serves as collateral.  A HELOC comes with a lower interest rate compared to a personal loan.

Homeowners can also access loans like FHA Title 1 Loan, PACE Loan, or Cash-out Refinancing for their home improvement project.

Should you take a loan for home improvement? 

There isn’t one straight answer to this question. Also, the answer will differ from one person to the other. A lot of things count including your financial situation, your ability to borrow, and the long-term effect of the loan. Before making the decision, consider the following factors.

Factors to consider before taking a loan for home improvement/maintenance 


You can take a loan for home improvement if the project is urgent. For example, if you have a leaky roof in a rainy season and need to search for roofing companies near me to come out and fix the issue, then such problems cannot wait until you have money to solve it. Since waiting for a long time can worsen the situation, you may have no other choice than to take a loan to cover the cost.

How affordable is the loan?

Before taking out a loan, consider whether you can afford the monthly deductions, and use tools such as this bridging loan calculator to organize the exact details. Will the loan affect your monthly budget or not? Will your financial situation remain positive with the loan? If the answers are satisfactory, then you can go ahead with your loan plan. If not, however, then you may have to look elsewhere including borrowing from friends and family.

Interest rate

Before taking a home improvement loan, check out the interest rates. Look for a loan with a very low-interest rate since high-interest-rate loans can jeopardize your finances. You can opt for either a secured or unsecured loan depending on the terms and rate. But not that, you put your home at risk with a secured loan.

Long-term effect

 Will the loan have a long-term impact on your life and that of your dependents? Will the loan prevent you from reaching your financial goal or not? Will it affect your monthly bill payments, or prevent you from honoring your financial obligations? Consider all these factors before taking a home improvement loan.

The above factors are critical and should determine whether or not to take a loan for your home improvement. If you have a good credit score and are in a better financial situation, taking a loan for your home maintenance will be worth it. However, stay away from such debts if you are heavily indebted, with poor credit scores and limited income.


Home maintenance and improvement are very critical in safeguarding the interest in your home. Hence; it should be one of the topmost priorities on every homeowner’s to-do list. With that being said, does the project merit your being in debt? Your answer will determine whether or not to take a loan for your home improvement. 

The best option is to use personal savings for your home improvement. But if such an option is unavailable, and the maintenance is urgent, take your chances with a loan.  Though there are several types of loans for home improvement, don’t just jump into any. Before contracting the loan consider all the pros and cons that come with it and how it can affect your finances. Also, read through the terms and conditions that come with the loan options to prevent later regret.