With home prices high and inventory tight, more owners are renovating instead of moving. Here are 7 top options and how to pick the right one (learn more about what is first national bank? mortgage lender overview | rateroots).
First, match the loan type to your project
Before comparing lenders, know your three main paths:
- Home equity (HELOC or home equity loan): Lowest rates because your home secures the loan. Best for large projects if you have equity and don't mind a lien.
- Unsecured personal loan: No collateral, fast funding, fixed payments — but higher rates. Best for smaller or urgent projects.
- Renovation mortgage (FHA 203k / Fannie HomeStyle): Rolls the remodel cost into your mortgage based on the home's after-renovation value. Best for major rehabs or buyers renovating at purchase.
1. Best HELOC: Figure
Figure offers a fixed-rate home equity line with a fast, largely online process — many borrowers get approved in minutes and funded within days. Fixed draws make budgeting predictable, unlike a variable-rate HELOC. Strong pick for owners with solid equity who want speed.
2. Best home equity loan: Discover Home Loans
Discover offers home equity loans with no origination fees, no appraisal fees, and no closing costs at closing, plus generous term options. The lump-sum, fixed-rate structure suits a defined project with a known budget.
3. Best for large equity draws: PNC / regional banks
Traditional banks often offer the largest lines and relationship discounts if you already bank with them. Rates can be competitive for high credit scores, though the process is slower and more paperwork-heavy than fintech lenders.
4. Best personal loan for good credit: SoFi
SoFi funds unsecured home improvement loans up to six figures with no fees and same-day-to-few-day funding. No collateral means no lien on your home — ideal for a mid-sized project when you don't want to touch equity or wait on an appraisal.
5. Best personal loan for fair credit: Upgrade
Upgrade approves borrowers with lower credit scores than many lenders, with fixed rates and clear terms. Rates run higher to offset risk, so borrow only what you need and compare the total interest cost against a secured option.
6. Best renovation mortgage: a 203k / HomeStyle specialist lender
For gut renovations or fixer-uppers, an FHA 203k or Fannie Mae HomeStyle loan lets you finance the purchase (or refinance) plus the renovation in one loan based on the projected after-repair value. Work with a lender that specializes in these — they involve inspections and contractor draws, so experience matters.
7. Best for contractor-arranged financing: GreenSky-style point-of-sale loans
Many contractors offer instant financing at the point of sale through networks like GreenSky. Convenient and fast, sometimes with promotional 0% periods — but read the terms carefully, because deferred-interest promotions can be costly if you don't pay the balance in full before the window closes.
How to choose the right lender
- Compare APR, not just the rate. APR includes fees and reflects true cost. A "low rate" with high origination fees can lose to a slightly higher rate with none.
- Weigh secured vs. unsecured. Equity loans are cheaper but put your home at risk and take longer. Personal loans cost more but fund fast with no lien.
- Match the term to the project's life. Don't finance a 10-year improvement over 3 years if the payment strains your budget — or a 3-year fix over 20 years and pay interest long after it's gone.
- Get at least three quotes. Rates and fees vary widely by lender and credit profile; a few quotes can save thousands.
- Confirm funding speed. Fintech lenders fund in days; renovation mortgages take weeks. Time-sensitive repairs change the math.
The bottom line
If you have equity and time, a HELOC or home equity loan from a lender like Figure or Discover usually wins on cost. If you want speed without a lien, a personal loan from SoFi or Upgrade fits. For major rehabs, a 203k or HomeStyle renovation mortgage lets one loan cover it all. Compare APR and total interest across at least three quotes before you commit.
Educational information only, not financial or lending advice. Rates, fees, and lender terms change frequently and vary by borrower. Verify current terms directly with each lender before applying.
