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Home Improvement Loans in Alabama

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Alabama Home Improvement Loans

For many homeowners in Alabama, getting a home improvement loan is a great way to modernize and increase the value of their homes while raising curb appeal and saleability. Learn more and check offers for home improvement loans in Alabama at Acorn Finance!

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How to Get a Home Improvement Loan in Alabama

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Complete your application on your selected lender’s website
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Helping Homeowners Get Home Improvement Loans in Alabama

Alabama homeowners nestled in this southern state enjoy hot summers and mild winters filled with plenty of humidity. Therefore, home improvements in Alabama such as sunrooms or covered patios are popular, among many other improvements or repairs. Afterall, you won't want to go through a hot summer with a broken HVAC in Alabama. To afford costly repairs and home improvements in Alabama, homeowners often turn to home improvement loans. Read on for more insight about home improvement loans in Alabama.

Home Improvement Loans in Alabama: Frequently Asked Questions

How do home improvement loans work in Alabama?

There are several factors that could impact which type of home improvement loan works best in Alabama. Each type of loan works differently and the requirements can vary.

If you already own your home, then you could consider a home equity loan, home equity line of credit, or a secured or unsecured personal home improvement loan. These loans are specifically designed to help borrowers obtain the funds they need to make renovations, upgrades, and repairs on their existing homes.

Here is a quick breakdown of how these popular loan types work.

  • Home equity loan: If you have a minimum of 20% equity in your home, meaning that the mortgage balance on your home is equal to or less than 80% of the home's appraised value, you can borrow up to 85% of that equity in the form of a home equity loan.
  • Home equity line of credit: If you have a minimum of 20% equity in your home, you may be eligible for a revolving line of credit called a home equity line of credit. A lender can grant you a credit line with a credit limit depending on the amount of equity you have in your home. Borrow as much or as little of that credit line as you need to make the purchases and hire the professionals you need to complete your home remodeling project. You only need to pay back what you borrow and interest is only charged on that amount. The more you pay back, the more you can borrow again at a future date. Similar to a credit card.
  • Unsecured personal home improvement loan: Unsecured personal home improvement loans are extended based on a borrower's creditworthiness. With loan amounts up to $100,000 available, depending on credit score, and no collateral required - these are a popular option. Compare offers with no credit impact at Acorn Finance. Typically, loans are funded as a lump sum minus fees and repaid in fixed monthly installments with interest.
  • Secured personal home improvement loans: Secured personal home improvement loans are similar to unsecured loans in terms of how they work, but they are secured by collateral. As a result, they may take longer to fund and involve more risk for the borrower.
  • Section 504 Home Repair Program: A loan of up to $40,000 for very-low-income homeowners to repair, improve, or modernize their homes or a grant of up to $10,000 for elderly homeowners to remove health and safety hazards from their homes.

If you do not own a home but you are looking to purchase an older home and renovate it, then you have a number of other options available to you in the state of Alabama.

Here is a quick breakdown of commonly used home renovation loans.

  • Fannie Mae Homestyle Renovation Mortgage: Borrowers can obtain up to 75% of the estimated post-renovation appraisal value with down payments as low as 3% for borrowers with a minimum credit score of 720 or higher. Borrowers with a credit score as low as 680, may be required to put in a downpayment of up to 25%. Loans come with terms of either 15 or 30 years. All home improvements must be completed within 12 months of the mortgage closing.
  • Freddie Mac CHOICERenovation Mortgage: A loan program for individuals looking to purchase and rehabilitate, renovate, repair, or restore an existing home. Borrowers with credit scores of 720 or higher may qualify for the loan with only a required down payment of 5%. Borrowers with credit scores as low as 620 may need a down payment of up to 25%. Loan terms can be 15, 20, or 30 years.
  • FHA 203(k) Mortgage: The FHA203(k) loan program may be a good option for borrowers with lower credit scores who are looking to purchase an older home and renovate it. FHA 203(k) loans require a 3.5% down payment for borrowers with a credit score of 580 or higher and a down payment of 10% for borrowers with a credit score somewhere between 500 and 579. These loans can be for up to 110% of the estimated home value after the renovations are completed. Loan terms can be for 15,20,25, or 30 years.

VA Renovation Loan: VA renovation loans are reserved for veterans, surviving spouses, or active duty service members who have a minimum credit score of 620 and who are in need of funds to renovate an older home. All work must be completed by VA-approved contractors since the funds are paid directly to the contractors by the federal government. Little to no down payment is required and closing costs are limited.

How do you apply for a home improvement loan in Alabama?

Before you apply for a home improvement loan in Alabama, the first thing you should do is determine what kind of home improvement loan works best for you. Once you know the type of loan, then you can narrow your search to lenders who specialize in the loan type you are seeking.

Whether you are looking for a home equity loan or a personal home improvement loan, the next step is to prequalify. Once you complete a prequalification application, you can start to receive personalized loan offers from lenders that will show you how much you can expect to pay in interest, monthly payments, and any other potential fees. You can compare the details of each loan offer side-by-side and go with the lender who offers you the best loan for your needs.

How do you find the right home improvement loan in Alabama?

Advertised rates are one thing - but real rates you qualify for are another. The best way to find the best home improvement loan in Alabama based on your actual credit score and history is to compare offers. Checking offers can sometimes impact your credit score so be aware of that when applying for loans. One of the best ways to choose the right home improvement loan is to start by exploring offers at Acorn Finance. Our network of top national lenders can extend personalized home improvement loan offers with no credit impact!

Find Colorado Home Improvement Loans at Acorn Finance

Finding the right home improvement loan can be a time consuming and difficult. At Acorn Finance, we have done our best to make the process for finding the right loan much easier. Check offers from our network of trusted lenders without an impact to your credit score! Many homeowners have lots of questions, so here are our common tips when it comes to searching for the right home improvement loans in Alabama.

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What are the best uses for a home improvement loan?

A home improvement loan can be used for any type of home improvement project you would like, however, some of the best uses of the funds from a home improvement include projects with a high return on the initial investment.

How much can you borrow with a home improvement loan?

Personal home improvement loans have a maximum loan amount of $100,000, although this can vary by lender. The maximum you qualify for will depend on requirements and credit score. Secured home improvement loans can offer higher loan amounts.

What are the requirements to get a home improvement loan in Alabama?

There are different requirements for different home improvement loans depending on the loan type and lender. For example, home improvement loans that are based on the value of your home and the amount of equity you have in it, require that you already own your own home to qualify. Plus, they require a home appraisal to validate the equity. Here are some basic requirements for secured and unsecured home improvement loans in Alabama:

  • Credit score
  • Debt-to-income ratio
  • Employment
  • Bank account
  • Collateral (if secured)
  • Financial stability
  • Credit history

Find out which lenders you meet the requirements for when you explore offers at Acorn Finance.

See More Home Improvement Loans by State:

Pros & Cons of Home Improvement Loans in Alabama

There are many advantages and disadvantages to home improvement loans in Alabama. Here is an example of some of those pros and cons.

Pros

  • Increase home value
  • Modernize appliances and energy efficiency
  • Easy monthly payment to repay a sizeable upfront sum
  • Competitive interest rates and loan terms

Cons

  • Additionally monthly payment eating into monthly budget
  • Interest payments on top of other potential fees

Frequently Asked Questions

What is the easiest way to get a home improvement loan in Alabama?

Before applying for a home improvement loan, you should determine how much you need to borrow. Unsecured loans can be offered up to $100,000, depending on credit score and what the lender can offer. Since unsecured loans do not require collateral, they are often more accessible to homeowners in Alabama. Personal loans, commonly referred to as home improvement loans, are a popular type of unsecured loan for home improvements in Alabama. Visit Acorn Finance to check home improvement loan offers up to $100,000, depending on your credit score. 

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How does your credit score affect your home improvement loan options?

Credit score is among the requirements set forth by most lenders. It’s a representation of your creditworthiness, defined as how likely you are to repay a loan. Some home improvement loan options (unsecured loans) are based solely on creditworthiness. Unsecured loans are not backed by collateral, so there’s more risk for the lender. Therefore, unsecured loans may place more emphasis on credit score. Offers will be more likely to be returned for borrowers with fair, good, average, or excellent credit. Additionally, credit score can play a role in the loan amount, repayment period, and APR you qualify for. 

Whether you have near-perfect credit or credit challenges, you should still compare offers to ensure you find the best home improvement loan offer in Alabama. Checking your credit score before applying for a loan can help you properly prepare. Some credit monitoring services offer insights to help consumers improve their credit score. Sometimes, it’s as simple as paying down a credit balance, although improvements usually do not update instantly. Another tip is to gather pay stubs or tax returns to verify your provable income before applying for a loan. It’s important to submit accurate information from the get-go in the event the lender requests documentation. If you are unable to satisfy a lender’s request to prove documentation, they may revoke or change their initial offer. Submitting accurate information (even if your mindset is just to check offers) can help the rest of the process go smoother should you choose to accept an offer. 

Why are online home improvement loans the best option?

With the cost of homes rising, some homeowners have found themselves in a position where staying put is the best option. By using a home improvement loan, you can make necessary or optional home improvements without borrowing against your home. By doing so, you can access the funds you need without risking losing your home. 

What are the best home improvement loans for Alabama residents? 

The best home improvement loan will depend on your personal situation. For some Alabama homeowners, it’s a secured loan option, while for others, it’s an unsecured option. For substantial home improvements, you may need to use a secured loan. Let’s compare the two:

  • Secured Loans: Secured home improvement loans are backed by collateral. This can include home equity loans or a home equity line of credit (HELOC). Homeowners often use their home as collateral to obtain funds to make home improvements. Secured loans can offer higher loan amounts and longer repayment terms compared to unsecured loans. Secured loans offer protection for the lender. In the event the borrower defaults, the lender can seize the collateral. The collateral can then be sold to help the lender recoup their funds. However, the borrower assumes risk by providing collateral. To qualify for a home improvement loan or similar, you’ll likely need equity in your home. 
  • Unsecured Loans: Unsecured home improvement loans are not backed by collateral. Personal loans (also referred to as home improvement loans)  are an example of unsecured loans. Unsecured loans usually have faster funding times, since there is no collateral requirement. However, unsecured loans are based on creditworthiness. To qualify for large unsecured loans, you will likely need good credit and solid income to qualify. Unsecured loans may present higher APRs for borrowers but less risk since you do not have to provide collateral. If you default on a loan, secured or unsecured, your credit score can be negatively impacted. 

Before checking loan offers, consider checking your credit score and getting estimates for your home improvement project. These two items can help you understand the financial aspect of your situation better. To find the best home improvement loan offers with no credit score impact, visit Acorn Finance

How do you compare Alabama home improvement loans?

Some banks, credit unions, and or financial institutions can extend a pre-qualified offer with no impact on your credit score. While applying with each source or lender individually is one way to compare offers, you can save time using a platform such as Acorn Finance. Check rates from our network of top national lenders in a matter of seconds with no credit score impact. As you compare offers, consider the following details:

  • Origination fees: Also known as an upfront fee, origination fees can be charged by a lender to process a new loan. Origination fees are generally calculated as a percentage of the total loan amount. 
  • Fixed APR: Fixed monthly payments are more predictable and often simpler to budget. If the APR is fixed, the payment should be fixed, too. If the APR is variable, then the required monthly payment is likely variable too. While variable rates can sometimes benefit borrowers, some of the best loans come with fixed APRs. 
  • No early repayment penalties: The lenders featured on our list, do not charge repayment penalties. This gives borrowers the opportunity to pay off their loan early to save money on interest and potentially other fees too. As a result of paying off the loan your credit score may go up.
  • Streamlined application process: We love hassle-free processes, don’t you? Some lenders can be difficult to do business with. A red flag that challenges are ahead starts with the application process. Find lenders with streamlined application processes that can deliver fast loan decisions. At Acorn Finance, you can check rates in a matter of seconds with just a little bit of personal information. Our platform leverages advanced technology to match borrowers and lenders. As a result, you can narrow down the best loan options faster.
  • Funding options and speed: At Acorn Finance, our lending partners can fund loans in as little as 1-2 business days, although funding times may vary. Fast funding can be a reflection of a streamlined process and a lender that’s using advanced technology. 
  • Borrower perks: Some lenders offer perks for borrowers, such as credit monitoring services or auto payment discounts. Additionally, some lenders offer convenient smartphone apps and online portals to manage accounts. Review the lender and what they can offer as part of your decision about who is best.
  • Support: While you may be asking to borrow money, you’re still a customer. Read customer reviews and notice how the lender makes customers feel. You will be doing business with the lender you choose, and therefore, you want a lender that’s easy to work with and delivers top-notch customer service. 
  • APR: In most cases, the loan process starts with a pre-qualified offer. Following the offer, the borrower accepts the offer, and the underwriting process begins. Once the applicant is verified, a final approval is usually issued. The offer can change during this process, depending on what the lender finds. Be sure you monitor the APR and other factors of the loan to ensure you are getting the deal you originally said yes to. Focusing on total loan costs is a more accurate representation of the cost of the loan compared to the monthly payment. 

When are home improvement loans in Alabama worth it?

Home improvement loans can increase home value and or improve your quality of life. Whether you plan to convert a basement to generate additional income or fix a leaky roof, you will need to consider your ability to repay and the situation. You should also consider all possible options available. Checking offers can help you make an informed decision as to whether a home improvement loan is worth it. 

Why choose Acorn Finance for comparing home improvement loans in Alabama?

As we navigate the chaos of life, most of us appreciate ways to streamline processes. Alabama homeowners can reduce the financial stress of home improvement projects by using a home improvement loan. Planning home improvement projects comes with enough stress as it is. At Acorn, we want to simplify the process of finding the best home improvement loan offer. We’ve created a platform that allows you to check home improvement loan rates in seconds with no credit score impact. With access to top national lenders and home improvement loan offers of up to $100,000, depending on credit score, Acorn Finance empowers Alabama homeowners. If you value your time, and money, visit Acorn to find the best home improvement loan offers.

Pros and cons of lenders Home Improvement Loans in Alabama:

LightStream

Best for home improvement loans 

Minimum qualifications: 

  • Minimum credit score requirement of 660 or above 
  • Minimum income requirement of $50,000/year

Pros:

  • No origination fees
  • Funding as soon as one business day on approved loans, although funding times can vary
  • Competitive loan offers
  • Allows co-signer
  • Large personal loans available 
  • Flexible repayment periods up to 12 years

Cons:

  • Strict qualification requirements
  • No access to pre-qualify through the LightStream website (When applying directly, you can get pre-approved but not pre-qualified, therefore, you may be subject to a hard credit pull. To get pre-qualified with LightStream, check offers through Acorn Finance to see if you qualify.)
  • No direct payment to creditors for debt consolidation loans

SoFi

Best for online personal loans for borrowers with next-to-perfect credit

Minimum qualifications:

  • Minimum credit score requirement of 680 or above 
  • Minimum income requirement of $50,000/year

Pros:

  • Flexible loan amounts and repayment terms
  • No origination fees
  • Competitive interest rates
  • Funding as soon as one business day on approved loans, although funding times can vary
  • Allows cosigner applications
  • Unemployment protection available

Cons:

  • High credit score requirement
  • Approvals may take 3 days or more

Best Egg

Best for personal loans for borrowers with fair credit 

Minimum qualifications:

  • Minimum credit score requirement of 600 or above 
  • No minimum income requirement 

Pros:

  • Fair credit scores can qualify
  • No minimum income requirement
  • Same or next day funding available, although funding times can vary

Cons:

  • Not available in some states
  • Origination fees between 0.99% and 6.99%
  • Higher APRs

Prosper

Best for peer-to-peer loans

Minimum qualifications:

  • Minimum credit score requirement of 600 or above 
  • No minimum income requirement 

Pros:

  • Low threshold for credit score
  • No minimum income requirement
  • Flexibility to change payment dates
  • Offers peer-to-peer lending

Cons:

  • Long funding times
  • Origination and late fees may apply
  • No rate discount for autopay is available
  • Restrictive repayment periods
  • Funding may take about 5 business days 

Upgrade

Best for bad credit personal loans 

Minimum qualifications:

  • Minimum credit score requirement of 560 or above 
  • No minimum income requirement

Pros:

  • Low credit score requirement
  • No early payoff penalty
  • Joint applications allowed
  • Funding as soon as one business day on approved loans, although funding times can vary

Cons:

  • Origination fees between 2.9% to 8%
  • Higher APRs, especially for subprime borrowers

Axos Bank

Best for refinancing existing personal loan

Minimum qualifications:

  • Minimum credit score requirement of 700 or above 
  • Minimum income requirement $48,000/year

Pros:

  • Low origination fees
  • Mobile app to manage loans
  • Fast funding times
  • Funding as soon as one business day on approved loans, although funding times can vary

Cons:

  • High credit score requirement
  • Origination fee up to 2%

OneMain Financial

Best for borrowers with less-than-perfect credit who need fast funding for a personal loan

Minimum qualifications:

  • Minimum credit score requirement of 600 or above 
  • Minimum income requirement $7,200/year

Pros:

  • Low credit score requirement
  • Offers secured loan option
  • Low income requirement
  • Flexibility to choose your payment date
  • Fast funding times

Cons:

  • High interest compared to similar lenders
  • Origination fee between 1% – 10% (or flat fee up to $500 depending on state)

LendingPoint

Best for fair credit personal loans with fast funding

Minimum qualifications:

  • Minimum credit score requirement of 600 or above 
  • Minimum income requirement $30,000/year

Pros:

  • Low origination fees
  • Relaxed credit score and income requirements
  • Same or next-day funding is available, although funding times can vary

Cons:

  • No joint applications
  • High loan costs
  • Short repayment periods 

Lending USA

LendingUSA is best for one-time purchases or uses, such as cosmetic surgery financing, pet financing, funeral financing, and more. LendingUSA offers loans for a variety of industries. Loans can be obtained through the LendingUSA website or through a merchant partner that refers to LendingUSA. 

One of the main highlights of LendingUSA is their offer to pay off a loan balance within 6 months. By doing so, 

no interest will be charged to the principal. 

Reprise Financial

Reprise Financial can help borrowers find personal loan offers that meet their needs. In order to help borrowers obtain funds quickly, Reprise works to streamline the personal loan process. With customized payment options and fixed rates, check personal loan offers at Reprise Financial. 

Similar to Acorn, one of the main highlights of Reprise Financial is the ability to shop and compare offers. 

Universal Credit

For borrowers with bad credit, Universal Credit may be your golden ticket to the funds you need. With a minimum credit score requirement of only 560, Universal Credit is a top choice for subprime borrowers. While loan costs may be higher, they usually are when it comes to borrowing money with bad credit. 

One of the main highlights of Universal Credit is their relaxed requirements.

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