The Best Home Improvement Loans With Bad Credit Bankrate Caret RightMain Menu Mortgage Mortgages Financing a home purchase Refinancing your existing loan Finding the right lender Additional Resources Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Bank Banking Compare Accounts Use calculators Get advice Bank reviews Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Credit Card Credit cards Compare by category Compare by credit needed Compare by issuer Get advice Looking for the perfect credit card? Narrow your search with CardMatch Caret RightMain Menu Loan Loans Personal Loans Student Loans Auto Loans Loan calculators Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Invest Investing Best of Brokerages and robo-advisors Learn the basics Additional resources Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Home Equity Home equity Get the best rates Lender reviews Use calculators Knowledge base Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Loan Home Improvement Real estate Selling a home Buying a home Finding the right agent Additional resources Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Insurance Insurance Car insurance Homeowners insurance Other insurance Company reviews Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Retirement Retirement Retirement plans & accounts Learn the basics Retirement calculators Additional resources Elevate your Bankrate experience Get insider access to our best financial tools and content Dennis Oblander/Adobe Stock January 11, 2022 Dori Zinn has been a personal finance journalist for more than a decade. Aside from her work for Bankrate, her bylines have appeared on CNET, Yahoo Finance, MSN Money, Wirecutter, Quartz, Inc. and more. She loves helping people learn about money, specializing in topics like investing, real estate, borrowing money and financial literacy. Aylea Wilkins is an editor specializing in personal and home equity loans. She has previously worked for Bankrate editing content about auto, home and life insurance. She has been editing professionally for nearly a decade in a variety of fields with a primary focus on helping people make financial and purchasing decisions with confidence by providing clear and unbiased information. Bankrate logo

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You have money questions. Bankrate has answers. Our experts have been helping you master your money for over four decades. We continually strive to provide consumers with the expert advice and tools needed to succeed throughout life’s financial journey. Bankrate follows a strict , so you can trust that our content is honest and accurate. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. The content created by our editorial staff is objective, factual, and not influenced by our advertisers. We’re transparent about how we are able to bring quality content, competitive rates, and useful tools to you by explaining how we make money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and, services, or by you clicking on certain links posted on our site. Therefore, this compensation may impact how, where and in what order products appear within listing categories. Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range can also impact how and where products appear on this site. While we strive to provide a wide range offers, Bankrate does not include information about every financial or credit product or service. If you have a home improvement project like a roof repair or kitchen remodel, you might need a home improvement loan to pay for it. However, this may be difficult for someone with a bad credit score. Not all lenders will offer loans to people in lower credit brackets. By exploring the best home improvement , you can find the financing you need to cover a home improvement project and repair or improve your home.

Best home improvement loans with bad credit

Not all home improvement loans for bad credit are created equal. That’s why it’s important to shop around and look at the various options at your disposal. When you do so, be sure to compare factors like interest rates, terms, and fees so you can make the right choice for your situation. Lender Max loan amount Minimum credit score $20,000 None $10,000 None $35,000 580

OneMain Financial

caters to borrowers with bad and . The lender offers fairly small unsecured loans with an involved application process. Secured loans are also an option if you’re willing to provide collateral. If you’re having trouble finding home improvement loans with bad credit, OneMain Financial might be the right fit. Perks: You can take advantage of joint applications to add another person to your application. This can be helpful if you don’t think you’ll qualify on your own or want to better your chances of getting approved. What to watch out for: Loans are capped at $20,000, which might not be enough, depending on the home repair project you’re funding. APRs start at 18 percent, which is high for the best offer and above the , but it might be reasonable if you’re applying for home repair loans for bad credit.

NetCredit

While caters to those with bad credit, you might be stuck with a higher APR compared to other lenders. In New Jersey, for example, APRs start at 34.00 percent. The good news is the lender doesn’t charge fees and reports to the major credit bureaus so you can build your credit. Perks: Loans start as low as $1,000, which is good if your home improvement project doesn’t cost that much or you’re faced with an emergency fix in that ballpark price range. What to watch out for: Limited options — NetCredit is only available in 36 states. If you don’t live in a state where it’s offered, you may want to look into alternatives. Beware that APRs go as high as 155 percent, which is more than four times the highest APR for competing lenders. For example, OneMain Financial caps its APR at 35.99 percent.

Avant

If you have bad credit, you may qualify for a loan through , a lender that caters to those with less-than-stellar credit. It offers a mobile app that can allow you to see your payment history and keep track of upcoming payments. Perks: Generous loan amounts ranging from $2,000 to $35,000. Fast funding means you can expect your loan payment as soon as the next business day. What to watch out for: The origination fee is up to 4.75 percent. Late fees and insufficient funds fees can also be charged. The APR starts at 9.95 percent, which is high compared to lenders who work with borrowers with better credit.

How to build up your credit to get a home improvement loan

Having bad credit could be a huge hurdle when it comes to qualifying for a home improvement loan. While you may have some lenders that are available to you, you’ll want to make sure you’re prepared before applying. Before applying, check your credit report and credit score to know what lenders will be reviewing. If there are any errors, dispute them and have them removed. This might increase your credit score and your chances of qualifying for home improvement loans with bad credit. Start making at least the minimum payments on all your outstanding loans and credit cards on time every month. Creating and maintaining a positive payment history is one of the most important factors in building up your credit score. Try to lower your credit use. That means pay as much as you can on your credit cards every month and avoid maxing out your limits. If possible, try to use them less. You might want to use cash more often if you tend to overspend. Keep in mind that there’s no “quick way” to build your credit. It will take some time so you can’t expect better rates right away. If your home improvement project can’t wait, you may have to settle for higher rates or more favorable terms.

Other options for getting a home improvement loan with bad credit

While getting a might be a good idea for some, it’s not the only option. You can look into alternative ways of funding your home improvement project. Home equity loan: A is a type of second mortgage you can take out on your home to cover home-related expenses, like home improvement projects. Rates are fairly low and can range anywhere from 3 percent and 12 percent. The amount you can borrow depends on how much you have built. Your home is used as collateral, which means your credit score doesn’t matter as much compared to a personal loan. This makes it a great option for loans for bad credit. The downside is that you could lose your home to the bank if you default on the home-backed loan. Home equity line of credit: A is like a home equity loan in that you can borrow money to finance home improvements using your home as collateral. But instead of giving you a lump sum, a acts as a revolving credit line similar to how a credit card works. Since HELOCs come with variable rates, they can’t exceed the maximum legal limit for federal credit unions, which is currently 18 percent. A HELOC is good if you have ongoing improvements and aren’t sure when you’ll need the money (or how much). Bad credit loans: Beware of no-credit-check home improvement loans, as companies that offer them often charge exorbitant interest rates sometimes more than 400 percent. The extremely high-interest rates could put you in more debt.

The bottom line

While bad credit can make or break your chances of getting a home improvement loan, you still have some options to borrow cash. Review each option you have, including online lenders, banks or credit unions near you. Use a to determine if you can afford the monthly payments before taking out the loan. After you’ve gotten your loan, it’s important to make on-time payments every month to make sure your credit score doesn’t tank. Budget for your new loan and do your best to pay off any other outstanding debt to give your credit score a boost. Even with a new loan, you should work on getting your credit score in the best shape possible. SHARE: Dori Zinn has been a personal finance journalist for more than a decade. Aside from her work for Bankrate, her bylines have appeared on CNET, Yahoo Finance, MSN Money, Wirecutter, Quartz, Inc. and more. She loves helping people learn about money, specializing in topics like investing, real estate, borrowing money and financial literacy. Aylea Wilkins is an editor specializing in personal and home equity loans. She has previously worked for Bankrate editing content about auto, home and life insurance. She has been editing professionally for nearly a decade in a variety of fields with a primary focus on helping people make financial and purchasing decisions with confidence by providing clear and unbiased information.

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