Home improvement loans

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Big ideas for your home?

A loan could help you spruce things up and possibly boost your home's value

Secured or unsecured loan?

Our guide breaks down the difference so you can choose with confidence

Fund your reno without the faff

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^Correct as of September 2026.

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What is a home improvement loan?

A home improvement loan lets you borrow a lump sum to pay for work on your property, from repairs and decorating, to a new kitchen or loft conversion.

Home improvement loans can be unsecured or secured. An unsecured personal loan isn’t tied to your property. A secured loan uses your home as security. This means your home may be repossessed if you don’t keep up repayments on a debt secured on it.

How do home renovation loans work?

With a home renovation loan, you borrow a set amount, then pay it back in fixed monthly instalments over an agreed term.

Compare home renovation loan deals

Check your eligibility to see which home improvement loans you’re likely to be offered, without affecting your credit score.

Then compare interest rates, monthly payments, any fees and the cost of the loan overall.

Apply for your loan

If your application is approved, the money could be in your account within days (or possibly within hours if you’re an existing customer).

Start your home improvement

Use the lump sum to pay for renovation projects, which could potentially increase your property’s value.

Repay the loan

Pay back the loan in fixed monthly repayments. You can choose to pay off your loan early but you might face an early repayment charge.

Use our home improvement loan calculator

Our loan calculator is a general personal loan tool, so you can use it as a renovation loan calculator too. Enter your project budget to see roughly what the monthly repayments could be.

Did you know?

Our data shows that customers typically apply to borrow £13,120 over 5 years on a home improvement loan².

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What are the different types of home refurbishment loan?

There are two main types of home improvement loan to consider: unsecured or secured. Here’s how they work.

Consider an unsecured loan if

You have a good credit history: approval is based on your ability to pay back the loan. Lenders will check your credit history to see how you’ve managed money in the past. You may also need to show you have a regular income.
You're planning a smaller project: an unsecured loan could be a useful way to fund smaller home improvements.
You don't want to use your home as security: unsecured loans carry less risk to your home because you don't have to put up your home as security to borrow.

Consider a secured loan if

You're planning a major building project: a secured loan could be an option if you need to borrow more to cover the cost.
You want a lower interest rate: your monthly payments might be cheaper – although if you’re paying back the loan over a longer term, you could end up paying more in interest overall.
You don't mind using your property as security: your home could be repossessed if you fall behind on the repayments.

How much can I borrow with a home improvement loan?

You can use Compare the Market to compare unsecured personal loans of up to £50,000, which suit smaller projects.

For bigger builds, a secured loan, also known as a homeowner loan or home equity loan, could let you borrow up to £250,000, but it's secured against your home.

How much you can borrow depends on your project costs, credit history, income and the equity in your home.

Compare the Market Limited acts as a credit broker, not a lender. To apply you must be a UK resident and aged 18 or over. Credit is subject to status and eligibility.

What are the pros and cons of a loan for home improvement?

A home improvement loan can help you pay for renovations sooner and allows you to spread the cost, but you’ll be charged interest on your borrowing.

Advantages of a home improvement loan:

Get started sooner – you won’t need to save up to get the green light for your redesign project. You’ll be good to go as soon as your builder is free to begin.
Quick access to your money – approval for an unsecured loan can be quick, although secured loans typically take a little longer. You could have the money in your bank account within days; in some cases, just 24 hours.
Simple to budget – a loan with a fixed monthly repayment can help you to budget.
Choose how long you borrow for – most loans run for one to five years, but some lenders offer up to 10 years for larger amounts.
Decide on your loan size – always be sure you can afford the monthly repayments.
Spend your money as you like – in most cases, you don’t have to specify what you want the money for. If your project comes in under budget, you could use the rest of the loan on something else or put it toward repaying the loan.
Potential to add space and value – you could add space for a growing family, or overhaul a tired design and potentially increase your home's value.

Disadvantages of a home improvement loan:

Higher costs – you’ll have to pay interest on what you borrow, so your project could end up costing more than if you waited and saved up.
Home value might not rise – depending on market conditions and the work you do, you might not improve the value of your home by as much as you spend on it.
Interest rates can be high – unsecured loans typically come with higher rates of interest than secured loans.
Risk to credit score – missing a repayment could mean extra charges and could negatively affect your credit score.
It could be pricier to borrow if you have a poor credit history – you could also have fewer choices of lender.
Risk of home repossession – if you secure the loan against your home and fail to keep up with the repayments, the lender can repossess your home and sell it to recover the debt. This doesn't apply to unsecured loans.

What our expert says...

“The best way to borrow for home improvements isn’t the same for everyone. It will depend on how much you want to borrow and for how long.

“For example, a small kitchen refresh might mean you need to borrow a relatively modest amount, while a full extension could require a much larger sum over a longer period. That difference could affect which borrowing options are available and suitable for you.

“Lenders will consider your financial situation, your credit history and what’s affordable for you. It’s a good idea to compare loans to find a competitive interest rate before you commit.”

Sajni Shah, Personal finance expert

What should I consider when choosing a home improvement loan?

Before deciding on the best home improvement loan for you, consider:

How much you need to borrow

The bigger the loan, the more you’ll pay in interest. Only borrow what you need.

The interest rate

With a fixed interest rate, your payments will stay the same until the loan is paid off. With a variable rate, your monthly payments could go up or down.

How long you borrow for

Pick a longer repayment period and you’ll reduce the size of your monthly repayments. However, because you’re paying back the loan over a longer period, you may pay more in interest overall.

Your credit score

If you’re a homeowner with a less-than-perfect credit history, a secured loan might allow you to borrow more at a lower interest rate.

How can I find a home improvement loan?

It’s easy to compare home improvement loans with us. Answer a few questions and we’ll show you which loans you’re likely to be accepted for, without affecting your credit score.

You can compare unsecured personal loans and secured homeowner loans, based on:

How much you want to borrow
How long you want to repay for.

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What are the alternatives to a home improvement loan?

It could be worth exploring these alternatives, depending on how much you want to borrow and for how long.

Credit cards

If you’re looking to fund a smaller project, a 0% purchase credit card could be an option. As long as you pay back what you owe within the interest-free period, choose a card without fees and make the minimum monthly payments, the credit won’t cost you anything.

Remortgaging

Depending on how much equity you have in your home, you may be able to remortgage for a larger amount.

For example, if your home is worth £250,000 and your outstanding mortgage is £150,000, you might be able to remortgage for £175,000. You could then use the additional £25,000 for renovations.

As you’re borrowing more, your monthly payments are likely to rise so check that it’s affordable. And if you’re extending your mortgage term, you may pay more in interest overall.

You’ll also face remortgage fees. And double-check for any early repayment charges on your existing mortgage.

Remember, your home may be repossessed if you don’t keep up repayments on a mortgage or any other debt secured on it.

A second mortgage on your home

Some lenders will allow you to take out a second mortgage on your home. This isn’t an increase on your existing mortgage; it’s a new loan.

Just like any other mortgage, you’ll need to consider additional costs, such as surveyor’s fees and arrangement fees.

Saving up

If you’re planning a larger project, you could use savings to cover part of the cost and a home improvement loan to fund the rest.

Or perhaps you can break the work into more affordable stages rather than doing it all at once.

Home improvement loan guides

Find out how to fund home improvements, compare borrowing options and plan renovation costs more confidently

Managing your mortgage

How to fund home improvements

We explain the pros and cons of a range of funding options

Homeowner loans

Borrowing against your home can offer more, but comes with risk

Secured loans

There's a lot to consider when borrowing against a valuable asset

Credit card basics

0% credit cards: holidays and home renovations

See the benefits and drawbacks of spreading the cost with a 0% card

View all loans guides

FAQs

Can I add a home improvement loan to my mortgage?

Yes, by remortgaging, you can apply to increase your mortgage and use the extra money to pay for the projects. How much extra you can borrow will depend on the amount of equity you have in your home.

If you decide to remortgage to fund home improvements, be aware that borrowing more is likely to increase your monthly mortgage repayments. You may also need to repay your mortgage for longer. You’ll also have to pay remortgaging fees.

What’s the difference between a home equity loan and a home improvement loan?

A home equity loan, or homeowner loan, is secured against your home. A home improvement loan is typically unsecured. This means it’s approved on your perceived ability to pay back the loan, based on your credit history and income.

With a home equity loan, you can borrow against the equity you have in your home. For example, if your home is valued at £500,000 and you have £100,000 outstanding on your mortgage, the equity is £400,000.

A home equity loan may allow you to borrow more than you could with an unsecured home improvement loan. But it’s important to remember that you could lose your home if you fail to keep up with the repayments.

Can I get a joint home improvement loan?

Yes, you can apply for a joint home improvement loan. You’ll both be subject to the standard credit checks, so it’s important that you each have a good credit rating.

You may be eligible to borrow a larger amount with a joint home improvement loan.

Can I get a home improvement loan with a bad credit score?

It’s possible to get a home improvement loan with a poor credit history, but you’ll probably have less choice and face higher interest rates.

Depending on your credit rating, the lender may also want you to use your home as security for the loan. If you can’t make the loan repayments, you risk losing your home.

Before you apply for a loan, it’s a good idea to make sure your credit score is as healthy as possible. Get tips on improving your credit score.

What should I do if I’m struggling to make my loan repayments?

If you’re struggling to make your repayments on time, speak to your lender as soon as possible. They may be able to extend your loan to reduce your monthly payments or give you a payment holiday to help you catch your breath.

If you’re struggling with debt, you’re not alone. You can get free advice on managing your finances from services and charities including Citizens Advice, StepChange and the National Debtline.

What is a renovation mortgage?

A renovation mortgage could help you to buy a property that needs fixing up and finance the necessary renovations.

Some high-street lenders may not offer standard mortgages for properties that are deemed derelict or uninhabitable. This is often when they’re without a bathroom or kitchen, and have no running water. In that case, you’ll need a renovation mortgage.

Lenders who provide renovation mortgages typically base the loan amount on how much the property is expected to be worth after renovation. But you’ll need to be sure the property is worth the money you’ll have to put in to make it a home.

You can’t compare renovation mortgages with Compare the Market.

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Reviewed 15 Oct 2026 byCharlie EvansPersonal finance expert

Charlie is a senior commercial leader with almost a decade's experience across the UK’s leading personal-finance and comparison platforms. Before joining Compare the Market as Head of Commercial in 2024, he held senior commercial roles at TotallyMoney and MoneySuperMarket Group.

Methodology

¹Based on the % of respondents claiming they have used Compare the Market in the last 12 months vs. other leading PCWs. Source: Savanta BrandVue Financial Services, National Representative Survey of 12,221 respondents (September 2026)

² Correct as of September 2026.