The average payback in a home’s resale value is 56 percent of the cost of the remodel, according to CNBC.

Whether you just bought a fixer-upper, or you want to improve the value on your home, renovations take time, manpower, and money. CNBC reported that the average payback in a home’s resale value is 56 percent of the cost of the remodel.

According to HomeAdvisor, some of the most common rooms people renovate and their estimated prices include:
● Kitchen: $22,847
● Bathroom: $10,222
● Basement: $2,906
● Bedroom: $2,878
● Garage: $4,183

Unfortunately, not everyone who wants to remodel has the money to do so. Turning to alternative funding is a great way to help fund your project; however, it must be done prudently.

Statista predicts that the total sales of home improvement retailers in the U.S. will be around $409.2 billion! Houzz found that renovators put an average of $33,800 into their first-bought homes.

What Are The Options?

If you’re like most Americans, and can’t fund a renovation in cash, your options may include:

1. Personal Loans. One option to fund your home improvement project is with a personal loan. Depending on your history with credit, interest rates on personal loans can range from as low as 2.5% to over 30%! The lower the interest rate you’re able to secure, the more manageable it is for a home improvement project.

The benefit of personal loans is that they’re usually unsecured loans. This means you don’t have to put your home up as collateral, which is necessary with home equity loans.

A downside with these loans is that they usually come with higher interest rates, meaning you’ll pay extra in monthly interest fees. Try to make sure you have a fixed interest rate if you do choose this option.

2. 0% Introductory APR Credit Cards. If you have a good credit history, look into credit cards that offer a 0% introductory APR period for any purchases you make for the renovation. Depending on what card you’re looking at, the 0% period can range from 6 months up to as high as 18 months!

What makes this option interesting is that as long as you pay the minimum payment on your account monthly, you’ll avoid paying interest on your credit card balance. That means your card can be used as an interest-free loan over the course of the 0% APR period.

For example, say you rack up $3,000 in debt renovating your basement. If you used a credit card with a 0% interest period for 12 months, you could make monthly payments of $250 to pay off the debt completely by the end of your introductory period without paying a cent in interest.

Just always remember to pay off your balance in full by the end of the introductory period. After that period, the regular variable APR starts, which can result in expensive interest.

3. Home Equity Loan. A home equity loan is a second mortgage for a fixed amount of money. This type of loan is secured by your home. The loan is repaid through equal monthly payments over a fixed term, just like a regular mortgage.

However, if you can’t pay the loan as agreed, your lender can foreclose your home.

With these types of loans, lenders usually limit the total amount to 85% of the value of your home. Home equity loans have fixed interest rates, meaning the rates stay the same over the life of the loan. Your monthly payments never change.

Remember: Use Funds Responsibly

No matter which option you decide may help with your home renovations, make sure you’re borrowing money with discipline. Interest and late fees can add up quickly, creating an endless pit of debt.

In general, if you’re using a card without a 0% introductory APR, make sure any credit card balance is paid off both on time and in full by your due date to avoid interest.

If you’re currently carrying any debt, make it your top priority to get it eliminated as fast as possible.

Editorial Contributors
Danny Lipford

Danny Lipford


Danny Lipford is a home improvement expert and television personality who started his remodeling business, Lipford Construction, at the age of 21 in Mobile, Alabama. He gained national recognition as the host of the nationally syndicated television show, Today's Homeowner with Danny Lipford, which started as a small cable show in Mobile. Danny's expertise in home improvement has also led him to be a contributor to popular magazines and websites and the go-to source for advice on everything related to the home. He has made over 200 national television appearances and served as the home improvement expert for CBS's The Early Show and The Weather Channel for over a decade. Danny is also the founder of 3 Echoes Content Studio,, and Checking In With Chelsea, a décor and lifestyle blog.

Learn More