Ways To Finance A Swimming Pool
Adding a swimming pool can be a wonderful way to boost your property value - and have a little fun while you’re at it. A pool in the backyard can mean endless hours of entertainment, exercise, and a great way to spend time with your family and friends.
That said, having this backyard addition requires careful thought and planning. Costs from installation to maintenance can quickly add up. Therefore, make sure you take your time looking over your pool financing options.
Things To Consider Before Applying For Finance
Before diving into your installation, you’ll want to consider some important factors. First, installing a swimming bath is an involved process that requires professionals, a plan, and construction equipment. You’ll need to consider what kind you’ll want as well.
The different types available can affect the price of installation. Do you want a fiberglass pool or a concrete one? An above-ground pool or in-ground one?
A simple fiberglass swimming bath installed in the ground will cost you around $45,000-$85,000, while an above-ground one will cost you a little over $6,000. That’s a sizable difference between the two, so if your dreams include the former option, you may need in-ground pool financing.
Opt For A Personal Loan
Personal loans are solid options for individuals looking to make improvements to their homes. Since adding a pool can increase your home's property value, it’s reasonable to consider swimming pool financing with this type of loan.
A personal loan allows individuals to borrow a specific amount of money with a fixed interest rate over a specific amount of time. Therefore, your monthly payments won’t change and you’ll know exactly what you owe each month. You can get an unsecured personal loan, which means you won’t be obligated to put down any collateral for the loan. That ensures your house, car, and other assets remain safe.
To obtain good terms for swimming pool loans, you’ll likely need a strong credit history and credit score. In general, a good score will be in the mid to upper 700s. If you’re planning for a swimming bath in the future, you can take steps to improve your financial standing beforehand. By increasing your score, you’re more likely to receive a lower interest rate.
Apply For A Home Equity Loan
Financing might also be available through a home equity loan. Home equity loans (HELOC) are very similar to personal loans as both loan types have a specific repayment schedule, fixed interest rate, and a fixed monthly payment.
If you apply for a home equity loan, remember that there’s a limit to how much you can borrow. Typically, you’re limited to 85% of your home’s value with a mortgage and home equity loan together. A financial advisor or loan officer can walk you through the specific requirements and specifications.
Apply For A HELOC
HELOC will give you something a personal loan doesn’t: a credit line that you can borrow against. This comes with a variable interest rate that may fluctuate as the market changes. This also means that your total payment amount may change throughout the life of the loan.
Before you seek out financing with a home equity loan, remember that you’re taking on more risk. When you apply for a personal loan, you can choose an unsecured loan that’s less risky and doesn’t jeopardize your assets.
A HELOC, on the other hand, is riskier since you put up your home as collateral. If you can’t make your monthly payments, you’ll put your home at risk or be subject to foreclosure.
Bottom Line
Different pool loans come with different obligations, fees, and structures. Hence, it’s important you do your due diligence and find the right loan for your financial situation. Having a gorgeous swimming bath in the backyard won’t matter in the end if you can’t afford to take care of it.
Speak to a local contractor and gather prices to begin the process. Next, use a pool loan calculator to better understand your monthly payments, loan amount, and interest rate.
With a little research, you’ll be well on your way to some serious fun in the sun.
