HomeHome ImprovementSecured Home Improvement Loans
Advertising Disclosure Acorn Finance receives compensation from some of the companies featured on our website, which may influence the presentation and order of the offers shown. Please note that not all loan options, savings products, or lenders are represented on our site.

Secured Home Improvement Loans

Compare monthly payment options from several lenders in under 2 minutes.

Check Offers
A woman is using the Fiona Template to control her smart home app on her phone.

What Is A Secured Home Improvement Loan

A secured home improvement loan is a type of loan that is granted only once a form of collateral has been listed to guarantee that the loan will be repaid. In the case of a secured home improvement loan, the collateral is the home or the equity you have in your home. However, there are other types of secured loans that use another asset, like a business or a vehicle, as collateral.

Check Offers
Quick. Simple. Secure.
A blue icon with a leaf on a monitor and a phone.
1

Pre-qualify

Fill out an easy online form to check for pre-qualified offers with no impact to your credit score
A mobile phone and a tablet with a list on it.
2

Select offer

Compare terms and payment options to select the offer that’s best for you
A mobile phone and a tablet with a building on it.
3

Finish application

Complete your application on your selected lender’s website
A hand holding a dollar sign.
4

Receive funding

After your loan is approved, your funds should arrive within 1-2 business days2

Check offers
in seconds

Get pre-qualified for loan offers with an easy online form

Won't impact
credit scores

Checking offers will not impact your credit score

Competitive
payment options

Compare rates from our network of lenders

Receive
funds quickly

Same-day and next-day available for certain offers2

Compare Rates From Lenders in Our Network

Learn More About Secured Home Improvement Loans

Looking to make some home improvements but don't have the cash on hand? A secured home improvement loan could be a great option for you.

Read more - FAQ

+

What is a secured home improvement loan?

There are a few different types of secured home improvement loans, including cash-out refinance and FHA loans. Home equity loans also fall into this category, as do home equity lines of credit.
A cash-out refinance is when you take out a loan that is for an amount that's larger than your original mortgage, then use the cash balance to pay for home renovations. An FHA 203(k) Rehab Loan is an all-in-one loan that's insured by the Federal Housing Administration and is meant specifically for homes that desperately need renovation. With this kind of loan, you'll be able to buy a home and fund its repairs within a single loan – rather than applying for a mortgage and renovation loan separately.
A home equity loan is an installment loan that is paid out in one lump sum then repaid over a period of five to 30 years via fixed monthly payments with fixed interest rates. You'll need to have a strict budget in place for this kind of loan, since you can't receive a loan that exceeds 85% of your home's equity.
With a secured loan, you can borrow against the equity in your home to finance renovations, repairs, or any other type of home improvement project.

Who should get a secured home improvement loan?

Secured home improvement loans are ideal if you have major home renovations to do and are comfortable with the idea of using your house as collateral. Although you can get a secured home improvement loan and then use the funds to pay for non-home-related expenses (like a vacation, college, a wedding, or even consolidating debt), it's not a great idea to use this kind of loan for anything unrelated to your house.
That's because your house is on the line and if you fail to pay back the loan, you could end up homeless. Secured home improvement loans can offer lower interest rates than many other types of loans, which makes them attractive options for people who are having cash flow issues or trouble managing their debt.
If you're tempted to use a secured home improvement loan to fund an expense that's not related to your house, though, it might be time to sit down and take a look at where you could cut your spending and start living more within your means.

How hard is it to get a secured home improvement loan?

Like any other type of loan, getting a secured home improvement loan can be easy or hard, depending on your personal financial situation and health. Your likelihood of being approved also depends on how large of a loan you want to take out.
The most important variable in all of this is your credit score. Any credit score that's higher than 660 should qualify you for most types of loans from the vast majority of lenders, but there are some out there that will award loans to borrowers with lower credit scores, too. Of course, remember that the higher your credit score is, the lower your interest rates and more favorable your repayment terms will be.
Banks and lenders can look at other indicators of your overall financial picture, too. They might take things like your income, ability to repay your bills on time, and how much equity you have in your house (particularly in the case of a home equity loan or a home equity line of credit).

Is a home improvement loan typically secured or unsecured?

Home improvement loans can be either secured or unsecured, both options are widely available and either can be good options for homeowners looking to finance major repairs and renovations, depending on your specific needs.
An unsecured home improvement loan is more like a personal loan that does not have any asset attached to it to secure your debt. These loans don't use your home as collateral and don't require you to have a certain amount of equity in the home to qualify. Because of this, they can be easier and quicker to apply for.
However, the trade-off here is that you'll generally pay higher interest rates than what you might with a secured home improvement loan. The repayment terms might not be as favorable, either.

What are the requirements for a secured home improvement loan?

To get a secured home improvement loan, you'll need to start by comparing lenders.
For most secured home improvement loans, you'll need to provide information like your credit score, proof of income, and Social Security Number. Lenders will also look at specific details related to your home. Often, an appraisal needs to be done. In this process, a real estate appraiser will come to your home to inspect it and produce an approximate value. He or she may also look at the values of homes in your area to get a reasonable figure.

What is the difference between a secured loan and unsecured loan?

A secured loan is one that uses something you own as collateral – like your house. If you don't make payments on time for a set period of time (this time period varies, depending on the lender), the lender can take your collateral (your house) to repay the loan.
An unsecured loan does not have collateral, meaning you don't have to put your house on the line in order to secure the loan. Instead, lenders will make sure the loan is "safe" for them by charging higher interest rates and offering less-flexible repayment terms.

Does a secured home improvement loan affect your credit rating?

It can. When you apply for a secured home improvement loan, the lender will perform what's called a "hard pull" on your credit report. This can cause a temporary dip in your credit score, which is why it's important to only apply for a loan after you've been prequalified and know that you'll be approved (you shouldn't apply for multiple loans because each will cause a significant drop in your credit score).
If you pay your home improvement loan back in a timely fashion, it can actually cause your credit score to rise. Paying back your loans shows creditors that you are financially healthy and a person who is worth lending to. If you don't pay back the loan, however – or make late or inconsistent payments – your credit score could drop for the opposite reason.

How do you evaluate a secured home improvement loan offer?

How do you compare secured home improvement loans?

Evaluate all of the following factors as you choose the one that's right for you:
APR (how much interest you'll pay to borrow the money)
Fees, discounts, and penalties
How quickly you can get the money
Loan amounts and terms
Ease of application
Customer service
Lender reputation
Eligibility
Obviously, choosing a lender that offers some of the lowest interest rates is a smart move, but this isn't the only factor you should consider in your search. You will also want to think about fees. Does the lender charge an origination fee? Try to find a lender who charges the lowest origination fees you can qualify for and ideally one that won't charge prepayment penalties (which penalize you for paying the loan off early).
It's not a bad idea to read reviews from other borrowers about the lender, either. This will give you a better idea of what kind of customer service the lender has, how easy the application process is, and other factors.
Not sure where to start when you're comparing secured home improvement loans? Consider using a platform like Acorn Finance. With Acorn Finance, you'll be able to compare dozens of offers from lenders without impacting your credit score. You just have to fill out one simple form and you'll be matched with pre-qualified offers in less than a minute. It's like window shopping, but for home improvement loans!

What are the advantages of a secured home improvement loan?

One of the biggest advantages of applying for a secured home improvement loan is that you'll be able to tap into interest rates that are much lower than what you'd receive otherwise. Although interest rates are generally determined by your credit scores – since the lender will need to look at this variable to determine how much of a risk they are taking by lending to you – adding collateral into the mix can greatly increase your odds of a low rate.
That's because you're reducing the risk for the lender by showing that you have some skin in the game – your house. If you don't pay the loan, the lender can receive the house, car, business, or whatever it is that you used as collateral for the loan. It's really a win-win for them, so the interest rate will be a lot lower.
In some cases, you can qualify for a secured home improvement loan with a much lower credit score. Lenders are often more lenient with these kinds of loans because you're using the house as collateral to prove that you're worth the risk. With an unsecured loan, you may have to have a higher credit score to prove that you'll repay the loan.

What are the disadvantages of a secured home improvement loan?

That's not to say that secured home improvement loans are always the best choice, either.
It's important that you always read the fine print and details of the loan. One of the most important things to consider is the specific language of the collateral terms. Remember, with a secured home improvement loan, you're putting your house on the line – that's a big risk. If you fail to repay the loan, you could be homeless.
Make sure you understand the terms so there aren't any misunderstandings that could get you into hot water. Most lenders will wait until 90 days have passed without payment before they come after the collateral – while others give you only 30 days.
You may not be able to get a great home improvement loan if your home isn't worth that much, either. An appraiser will have to come to your home to estimate its value and compare it to nearby homes. This extra step can make applying for a secured home improvement loan take a bit longer than other types of loans, so it may not be ideal if you need money quickly and don't have time to wait for an appraisal. If you want to get money fast for an emergency home repair, applying for an unsecured home improvement loan (like a personal loan) might be a wiser choice.
Finally, remember that secured home improvement loans, like many other types of loans, do come with various penalties and fees. You could be charged for things like paying the loan off early, missing payments, or making a late payment. There are often closing costs and fees at the time of application that you'll have to pay for, too. Keep all these in mind to decide if a home improvement loan like this is right for you.

What lenders offer secured home improvement loans?

There are countless lenders that offer secured home improvement loans. Most commonly banks and credit unions offer secured home improvement loans, but online lenders can too. Upgrade is an online lender that offers secured home improvement loans. You may have to search a bit harder for an online lender that offers secured home improvement loans, but they do exist.

How do you get a secured home improvement loan?

To get a secured home improvement loan, first, decide which lender and which type of secured home improvement loan is right for you. Then, put together all the application materials you need to make the process as simple and streamlined as possible.
You can usually get a secured home improvement loan in the amount of $1000 to $100,000, but again, this varies depending on the value of your home, your financial health, and other factors. You may need a recent appraisal for your home, so make sure you factor in time for this process to take place.
You can apply for a secured home improvement loan by visiting a local bank or applying online.
You'll provide details like your Social Security number, W2s, pay stubs, and other information that paints an accurate picture of your financial situation. Once you're approved – a process that usually just takes a day or two – you can iron out details like your loan amount and term before you sign.
Then, you'll get your money. You can often get your funds in just a few days, although funding times may vary.
Applying for a secured home improvement loan may seem daunting, but it's worth it to get the money you need to improve your home. By following the advice we gave you in this post, you can make the process easier and faster. Apply for a secured home improvement loan today – and enjoy a more beautiful, comfortable home tomorrow.

Compare Rates From Top Lenders

$ Loan Calculator

Are you a contractor?
Generate more revenue with Acorn Finance.

Offer customers the ability to finance their dreams with zero dealer fees.

Get Started

Popular Home Improvement Projects

Barn Financing Options

One home, endless possibilities

MORE HOME IMPROVEMENT FINANCING OPTIONS

Personal Loan Information