Installing a swimming pool doesn’t come cheap. So, if you want to build a pool in your backyard, you might want to consider pool financing — unless you have a good amount of savings to sponsor your home improvement project.

Pool financing refers to getting some kind of monetary aid or credit from reputable loan lenders, banks, or credit unions — specifically for the project. It could be an unsecured personal loan, a home equity loan, a cash-out refinance, or a home equity line of credit (HELOC). Each financial option for a swimming pool loan comes with its distinct features, pros and cons, and eligibility.

Depending on your zip code, adding a pool can increase your home’s value by as much as 7%. Apart from this, installing a pool can provide you with unmatched enjoyment — keeping you cool during the summer months and providing you with the perfect party spot! 

However, pool installations are pricey, especially if you want to customize the pool design or add features such as pool heaters, waterfalls, Jacuzzi, etc. That’s when swimming pool financing comes to your aid — making your backyard dreams more affordable than you think.

Read more: Home addition loans: financing a home addition

How much does a swimming pool cost on average?

When it comes to pool costs, above-ground pools are cheaper than in-ground pools. Above ground pools cost between $1,850 and $4,977 while in-ground pools cost anywhere between $28,000 and $55,000 on average. Although above ground pool financing might be easier to get such pools do not add much value to your home and are not as long-lasting. 

The total pool installation cost depends on the type of pool, its shape as well as size, labor costs, degree of customization, and your geographical location. 

To give you a better idea, here’s a look at some of the popular inground pools and their average costs:

  • Vinyl pool: $20,000s to $60,000s
  • Fiberglass pool: $20,000s to $40,000s
  • Concrete pool: $30,000 to $60,000

Read more: Luxury home upgrades: Pool enclosure financing

What is the average monthly payment for a pool?

Usually, pool financing will give you access to anything between $5,000 to $100,000 — depending upon the type of loan. And, loan interest rates depend on your credit score as well as your loan term (swimming pool payment years). For example, if you get a loan of $25,000, at 5% for 15 years, your average monthly payment will be around $200.

Read more: Deck loans & financing options

What credit score do you need to finance a pool?

Although borrowers with less-than-perfect credit scores may manage to qualify for pool financing, the desired minimum credit score is at least 670. Credit scores of 740 or higher will give you lower interest rates and more affordable monthly payments.

Looking for a home renovation loan for your swimming pool installation? Peruse through Kukun’s easy loan options and get your dream pool now. 

Is it hard to finance a swimming pool?

So, can you get financing for a swimming pool with bad credit? Yes. there are options but you should be prepared for the high-interest rates and fees. Even if you’re willing to accept the advertised rates and terms, there’s another obstacle to cross — qualifying for swimming pool financing. 

To determine whether you’re eligible or not, lenders consider different factors, including your credit history and employment history.

If you’re applying for swimming pool loans with fair or even bad credit, it might not be the right time to add the financial burden of buying and installing a pool.

It’s best to work towards improving your credit and your financial situation. You may get a better pool-financing deal with a lower interest rate in the future.

Read more: Easy hot tub financing options for good & bad credit

How to finance a pool?

There are several types of home renovation loans available for homeowners. It’s important to understand their differences before choosing the most suitable financing plan based on loan purposes. Let’s look at some of the most popular swimming pool financing options.

  • Home equity loan: A home equity loan, or a second mortgage, lets you borrow funds against the equity you’ve built in your home. Your home equity is measured as the difference between your home’s current value and the amount you owe on your mortgage. This determines the total loan amount you can borrow.   
  • Home equity line of credit (HELOC): A HELOC also works on the basis of your home equity. But here, unlike home equity loans, you get your money in a lump sum. You get a revolving line of credit that allows you to use the line of credit again and again. There’s a draw period during which you can borrow money and then there’s the repayment period of returning what you owe. 
  • Cash-out refinance: In this type of funding, you can replace your existing mortgage with a new home loan (at a lesser interest rate) for more than you owe on your house. The cost difference goes to you in lump sum cash, which you can use for your pool financing. 
  • Unsecured personal loan: Personal loans are unsecured loans that do not require any home equity or asset as collateral. Since it’s a riskier proposition for the loan lender, the repayment terms tend to be shorter and the loan amount lesser. Personal loans tend to have higher interest rates than other types of financing, but it’s quicker — without putting your home at a foreclosure risk. 

Read more: Plumbing financing for good & bad credit

How long can you finance a swimming pool?

Most fixed-rate loans up to $100,000 come with loan terms from 1 to 5 years. If you get a home improvement loan for a pool, the term will be 7 to 15 years in all likelihood. The length of a typical mortgage loan is 30 years. If you’re buying a new home and want to add a pool, you can integrate your pool loan into your mortgage. That way, the pool cost is spread over three decades — making your loan payment easy to manage and affordable.

Keep in mind that loan terms are subject to change without notice, and depend on your loan lender/loan type. 

Here’s the loan term range of some of the best swimming pool loans:

Type of loan Typical Loan Term/ Repayment Period
Home equity loans5 to 30 years
HELOC10 to 20 years
Unsecured personal loans2 to 12 years
Cash-out refinance15 to 30 years

Read more: How do home improvement loans work and what to choose

Pros and cons of financing a swimming pool

There’s nothing better than having your own backyard pool to enjoy with your friends and family — especially when public pools are closed. Once you zero in on the best way to finance a pool, it’s easier to plan your pool installation — on schedule and in budget! And, the comfortable payment programs will make your home remodeling easier and manageable. Pool financing will get you the swimming pool you’ve always wanted — with the convenience of paying for it over time through favorable interest rates and fixed/adjustable monthly payments. Of course, they will be based on your credit score and credit report. 

Paying back the loan funds — whether through loans, credit unions, or credit cards — is another story. Making your scheduled monthly payments can be a bit stressful, especially if you’re experiencing cash flow difficulties. And, with home equity loans, there’s an added risk of property foreclosure. 

Always remember that if you default on your repayments, it can adversely affect your credit score and credit rating. But, don’t let that dissuade you from owning a beautiful swimming pool in your backyard. Plan your pool loan well and you’ll be just fine!

Read more: Patio financing: Great ways to finance concrete patios & more

Swimming Pool Financing & Loans was last modified: March 24th, 2021 by Ramona Sinha