Bathroom Remodel Financing

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Bathroom Remodel Financing

Bathroom Remodel Loans

Trends are constantly changing. This is true for fashion and today it is especially true for home renovations. What was considered in style and trendy a decade or two ago is now unfashionable and offputting. Bathroom remodels are a common way that today’s homeowners can quickly increase the look, feel, and value of their homes.

When a homeowner decides to begin a bathroom remodel, finances must be considered carefully. With the national average cost of a bathroom remodel being over $10,000, coming up with the money may be difficult. Luckily, today there are numerous ways of financing a bathroom remodel.

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What is bathroom remodel financing?

Bathroom remodeling financing offers a convenient way to finance your bathroom renovation without immediate cash outlay. In light of increasing costs and the desire for high-quality materials, homeowners are turning to financing options to cover essential expenses. With financing, you can fund various aspects of your bathroom remodel, such as sinks, showers, toilets, flooring, and more.

How does bathroom remodel financing work?

Bathroom remodel financing offers a means to fund your bathroom renovation project when you don't have immediate cash available. One common option for financing is through personal loans, which provide flexibility and convenience.

To secure a personal loan for your bathroom remodel, you typically start by researching lenders and comparing their terms, interest rates, and repayment options. Once you've chosen a lender, you'll need to complete the loan application process.

During the application process, you'll be required to provide personal and financial information, such as proof of income, identification documents, and details about your bathroom renovation project. The lender will review your application and assess your creditworthiness.

If approved for a personal loan, you'll receive the loan amount as a lump sum. This allows you to have the funds upfront to cover the various expenses associated with your bathroom remodel, such as purchasing fixtures, tiles, or hiring contractors.

Personal loans usually have fixed interest rates and structured repayment terms. You'll need to make regular monthly payments, including principal and interest, over the agreed-upon loan term. It's important to budget and plan your finances accordingly to ensure timely repayment.

Can a bathroom remodel be financed?

Yes! In fact, financing bathroom remodels is increasingly popular and vendors all across the country offer financing for bathroom remodels, kitchen remodels, home repairs, and all kinds of home renovation services.

Financing a bathroom remodel doesn't need to be very detailed in what you are remodeling. Most of the time, you will take out a lump sum of money from a lender and spend it however you see fit for the remodel.

As long as you make the payments required, the lender won’t have any problems with how the money is spent.

Types of bathroom remodel financing

It may be overwhelming when you begin to plan a bathroom remodel. From new fixtures and paint to finding someone to actually do the work - there is a lot that goes into it! And that is without even mentioning the cost.

Luckily, there are plenty of choices for dealing with the cost. Below are the most common options homeowners have when it comes to bathroom remodel financing.

Personal loans

As with many other home renovation projects, personal loans tend to be common for bathroom remodels as well. They are offered by private lenders all across the country and can be spent on whatever you the homeowner deems necessary.

Personal loans also can most often cover the entire expense of a bathroom remodel. Other financing methods may not be able to do so. This prevents you from having multiple payments to make for just one remodel.

Credit cards

Financing a kitchen remodel using a credit card can be a viable option if approached carefully. Start by assessing your credit card options, considering factors such as available credit limits and favorable terms. Determine your kitchen remodel budget and choose a credit card that aligns with your needs, such as low interest rates or promotional offers. Create a repayment plan and track your expenses diligently to avoid overspending. Consider balance transfer options if needed, and consistently manage your credit card balance by making timely payments. Responsible financial management is crucial when using a credit card for kitchen remodel financing.

Cash-out refinancing

Cash-out refinancing is another popular option that might be beneficial if you qualify. Simply put, a cash-out refi is when you take out a new mortgage that is greater than your current one.

Assume you've previously paid off a significant portion of your mortgage and now owe only $50,000. With a cash-out refi, you may take up a new $80,000 mortgage and pay off the $50,000 you owe on the house while receiving the remaining $30,000 in cash.

This money can then be used to upgrade your property, such as a bathroom makeover.
For a cash-out refi, lenders have extremely strict requirements, making qualifying considerably more difficult than doing so for a personal loan. However, you will almost always be offered a low-interest rate, with many lenders giving rates in the mid-to-low-three percent range.

Home equity loan

A home equity loan is a type of loan that gives a borrower a lump sum of money in exchange for their house's worth as security. The borrower will make regular monthly payments that include interest in exchange for this loan.

Because your house is used as collateral, they are sometimes referred to as a second mortgage. To be eligible, the borrower must already have equity in their house and have paid off a big enough sum to be able to borrow against it.

The most serious disadvantage of these loans is the risk of losing your house if you default on your payments.

Home equity line of credit

A HELOC, or home equity line of credit, is quite similar to a home equity loan.

Your home will be used as collateral for the loan, which is comparable to a mortgage. The primary distinction is that a home equity loan gives borrowers a flat sum upfront, but a HELOC functions more like a credit card.

You'll have a credit line up to the amount determined by the lender. You can then borrow up to that amount and pay it back monthly. Even after paying off the credit, you can borrow again, exactly like a credit card.

Just like a home equity loan, the main disadvantage is the risk of losing your house if payments aren't paid.

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Pros and cons of bathroom remodel financing

When considering any large expense, you need to think hard about the positives and negatives. This is especially true for large home expenses like a bathroom remodel. With costs often exceeding $10,000 it’s important the right decision is made.


  • Various Financing Options - You can choose from personal loans, HELOCs, credit cards, and more to finance these remodels.
  • Increased Home Value - When you remodel any room in your house, the value will increase and it will be more attractive to buyers.
  • Keep Your Savings - When financing, you do not need to pay upfront. This will allow you to keep your savings for emergencies.


  • Price - As with any major home project, bathrooms are expensive. You need to make sure you can afford the costs before getting financing.
  • Home as Collateral - Certain methods of financing require your home as collateral. This means if you default, you could lose your home.
  • High Interest - If your finances are bad or you choose to use a credit card, you can be paying very high interest which will set you back even further.

What are the average costs for a bathroom remodel?

Like any other project, a huge factor in the cost of a bathroom remodel is where you live. It also depends on what you intend to do in the bathroom, for example just new fixtures or a complete rebuild.

The average cost of a bathroom remodel in the US is currently around $10,000.

The average cost includes everything from parts and appliances to labor. Below are the most common expenses of a bathroom remodel:

  • Fixtures (like sinks and toilets) - $200 - $1,800
  • Shower - $300 - $3,000
  • Countertops - $200 - $1,000
  • Lighting - $100 - $400
  • Flooring - $200 - $1,300
  • Painting - $150 - $550
  • Plumbing - $250 - $1,450

As you can see, the ranges are very wide. If you choose to get basic fixtures and lighting, you could easily be on the low end of the estimates. However, if you decide you want top-of-the-line everything you will quickly find yourself at the top or even above those ranges.

What is the most expensive part of renovating a bathroom?

The prices for each different aspect of a bathroom remodel are listed in the section above. However, what usually costs the homeowner the most when remodeling a bathroom is actually the labor!

Labor usually costs anywhere from 40% - 65% of the total cost of the remodel. This is because you often need a few different specialists. You will need a plumber to work on your plumbing. You also need a contractor or specialists to install cabinetry, fixtures, lighting, paint, and more.

Be sure to research the labor well, as the prices they charge for the same job can be immensely different.

Is it a good idea to renovate a bathroom by yourself (DIY)?

If you know what you are doing, it is a great idea to remodel a bathroom yourself. As noted in the previous section, you would save 40%-65% of the total cost of your remodel due to the savings in labor.

You will still need to pay hundreds and maybe even thousands of dollars for materials, fixtures, and other supplies. Depending on your financial situation it may be worth it to still use financing to pay for all of these items.

If you are not 100% confident in your abilities, it makes more sense to hire a professional for your remodel. If anything is done incorrectly, you may need repairs, or worse case you may need to completely start over, resulting in even more money spent.

What credit score do I need to obtain bathroom remodel financing?

The fact is that people with a very low credit score will have trouble getting financing for anything. This also rings true for bathroom remodel financing.

If you decide to finance your remodel via a credit card that you already have, you could avoid the headache of applying and getting declined for loans. Just remember that this method is not recommended due to the intense financial strain it would put on you.

When it comes to personal loans, most lenders prefer that borrowers have above a 690 FICO score, but some lenders may make an exception to this.

For home equity financing, you will most likely need a score in the mid 600’s. While certain lenders may make an exception based on the rest of your finances, you will likely receive worse interest rates and other terms.

What type of ROI does a bathroom remodel give?

One of the main reasons homeowners decide to remodel their bathroom is the increase in the value of their home. While the numbers will vary greatly depending on the rest of your home and where you live, there are some average numbers that can help you make a decision.

For a middle of the range remodel, which could include new fixtures, showers, cabinets, and more - you will see an average ROI of 70.1%

For an upscale remodel, which would include top-of-the-line fixtures as well as potential structural changes and additions, the average ROI is 56.2%.

What is the best way to finance a bathroom remodel?

The most often recommended methods of financing a bathroom remodel are personal loans and HELOCs.

Each method has its positives and negatives, so be sure to research each thoroughly before choosing. In general, these methods are chosen because they will offer lower interest rates than other methods while still providing the necessary amount of money needed.

Credit cards are usually not recommended. The high-interest rates could put you into a financial situation that you do not want to be in, and leave you paying much more than your initial estimate.

How to apply for a bathroom renovation loan

  1. Assess your renovation needs: Start by determining the scope and cost of your bathroom renovation project. Consider factors such as new fixtures, tiling, plumbing, or any structural changes required. Having a clear understanding of your renovation needs will help you determine the loan amount you should seek.
  2. Research loan options: Explore various loan options available for bathroom renovations. Look beyond traditional personal loans and consider specialized home improvement loans or lines of credit specifically designed for renovation projects. Research lenders that offer competitive interest rates and flexible repayment terms.
  3. Check your credit score: Your credit score plays a crucial role in obtaining favorable loan terms. Check your credit score and address any potential issues or discrepancies. Taking steps to improve your credit score, such as paying off outstanding debts or resolving errors, can increase your chances of securing a loan with better terms.
  4. Gather necessary documentation: Prepare the required documentation to support your loan application. This may include proof of income, identification, recent bank statements, and any relevant renovation plans or contractor estimates. Having these documents ready in advance will streamline the application process.
  5. Submit loan applications: Apply for loans with lenders that offer suitable terms for your bathroom renovation. Submit your loan applications with accurate and complete information. Consider applying with multiple lenders to compare offers and increase your chances of approval.
  6. Review and compare loan offers: Once you receive loan offers, carefully review and compare the terms and conditions. Pay attention to interest rates, repayment periods, any associated fees, and penalties for early repayment. Select the loan offer that best fits your financial situation and renovation needs.
  7. Accept and manage the loan: After accepting a loan offer, work closely with the lender to finalize the loan agreement. Understand the repayment schedule and ensure you can comfortably manage the monthly payments. Develop a budget to track expenses and allocate funds efficiently throughout the renovation process.
  8. Begin your bathroom renovation: Once the loan is disbursed, use the funds to start your bathroom renovation project. Hire reputable contractors, purchase necessary materials, and closely monitor the progress to ensure the project stays on track.

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