How To Choose The Right Pool Financing Option

6-Minute Read


Soaking up the sun in your backyard is one of the best ways to enjoy summer. And as the hot months approach, you may find yourself thinking about installing a swimming pool to help keep you and your family cool. While this dream may sound tempting, the reality is that owning a pool can be expensive.

Thankfully, with the option of pool financing, owning a swimming pool is more attainable.

Can You Finance A Pool?

Although pools can be costly, there are many ways in which you can finance a pool installation. Whether you have the money to pay for a pool in cash upfront or you need a little help starting the process, there are ways to make your dreams of pool ownership a reality. When it comes to pool financing, it’s important to research your options and choose the one that best fits your needs and qualifications.

How To Finance A Pool

As you begin your search into pool financing, you’ll want to take all options into consideration. The more popular methods for pool financing are personal loans, home equity loans, home equity line of credit, a cash-out refinance or private financing through the pool company. Let’s take a look at each of these options in greater detail.

Home Improvement Personal Loans

A home improvement personal loan is one of the most common sources of pool financing. As a lump sum of money, homeowners can use this type of loan for any home improvement project. This allows them to begin construction on their pool immediately, rather than having to save up over a long period of time. This loan is then repaid in fixed, monthly installments.

Home Equity Loans

A home equity loan is a second mortgage that a homeowner can take out against the equity that they have built in their home. Because interest rates may be lower with this loan, it’s a popular option for home improvement projects. You’ll need to work with a lender to determine how much equity you have in your home and to assess if you qualify for this loan. The most important thing to know about a home equity loan is that your home is used as collateral for the bank and can be foreclosed by the bank if you default on your payments.

Home Equity Line Of Credit

A home equity line of credit (HELOC) works similarly to a home equity loan – the main difference is that the lump sum is used in the form of credit rather than a loan. Once the lender has given the homeowner this line of credit, they are able to draw from it over a set period of time. After this time is up, the homeowner must begin repaying the borrowed credit plus interest.

Cash-Out Refinance

A cash-out refinance is another popular option to use for financing a pool. This option works by refinancing a homeowner’s existing mortgage into a higher amount. If you opt for a cash-out refi, the difference between your new mortgage and your existing mortgage is then given to you in a lump sum of cash. This cash can then be used to pay for the pool, and is paid off with your monthly mortgage payments. Before committing, you should make sure that this option is right for you, as it’s important to have confidence that you can make these higher monthly mortgage payments.

Pool Company Financing

While many companies don’t offer their own direct financing, you may be able to work out a payment plan with them. It’s possible that these companies could also have a bank that they work directly with that can help you finance. The company will forward your information to the lender that they work with to arrange the details. It’s important to note that this method is often more expensive than other options.

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How Much Does A Swimming Pool Cost?

Installing a pool can be a major financial investment to take on. The type and size of the pool that you choose to build will be the biggest determining factors in how much you’ll be spending.

The average cost of installing an in-ground pool ranges between $20,000 – $60,000, while an above-ground pool runs between $1,000 – $5,000. However, an above-ground pool can cause serious damage to your lawn, costing you more in the long run and potentially even lowering your home value. Additionally, these pools will not last as long as an in-ground pool will. These are all important factors to think about when making a decision on what type of pool you want to build.

When building your pool, you’ll also need to choose what material you want to use. Your options for pool materials are usually vinyl, fiberglass or concrete. Each of these materials will have different price points. You’ll also want to factor in any features you’ll be adding to the pool design. Adding extra features to your pool such as a heater, slide, waterfall, an attached Jacuzzi or other unique features can increase the price of the pool significantly.

Other Cost Factors

Beyond the installation of the pool, there are several other costs associated with owning a pool that you should take into consideration as well. Whether it’s the ongoing maintenance costs, the yard landscaping around your pool or unexpected damages, these costs can quickly add up. The average pool owner is likely to spend thousands of dollars each year keeping their pool clean and well-maintained.

A majority of these servicing costs will vary based on how big your pool is and the specific features you have included in your pool. Another important aspect to consider is the climate of the location you live in. Your location can greatly affect how often you utilize your pool and when it needs maintenance throughout each season. There may also be additional costs that you’ll need to consider in order to protect your pool against certain weather conditions.

Does A Pool Increase The Value Of A Home?

When installing a pool, you may wonder if this project will add value to your home or not. Although a pool is a costly investment to make, its return value is not that great in comparison to other home improvement projects. The National Association of REALTORS found that, on average, homeowners only see about a 43% ROI with the addition of a pool. That’s why it’s so important that you factor ROI into your decision.

There are a few specific scenarios in which you may see an increase in your home’s value. For example, if you live in a warm climate where a pool can be used year-round, this can be an attractive feature to buyers and might even be one that they are looking for. Having a pool that doesn’t take up the entirety of a backyard and allows potential buyers to envision space for other features and activities can be an attractive selling point.

Keep in mind, these specific situations still cannot guarantee that the addition of a swimming pool will add value to your home. This is why it’s important not to rely on the resale value of your home down the road as a way to make up for the cost of investing in a swimming pool now.

Should You Finance A Pool?

There are a number of factors to think about when considering if you should finance a pool or not. Although the thought of taking a relaxing dip in the pool on a hot summer’s day might be tempting, it’s best to have confidence that taking on this big of a home improvement project is a good idea.

Reviewing your personal finances carefully with an advisor can help you assess whether or not you should take the plunge. They will be able to review whether you are able to qualify for financing and whether or not now is the right time.

Do You Qualify For A Pool Loan?

Once you’ve chosen the loan option that you’re interested in using to finance your pool, you’ll need to make sure that you qualify. For most of these loan options, you generally need to be in good financial standing with a strong credit score. While you may still be eligible for a loan even with a lower credit score, you’re likely to incur higher interest rates. Over time, this can end up costing you even more.

Is Now The Right Time?

Consider whether or not now is the right time to take out a pool loan. If you are already in financial debt or if your credit score needs to be improved, now may not be the right time to take on any extra debt. You should also remember that paying for the installation of a pool is just the beginning.

Over the course of your ownership, there will be maintenance costs and other servicing fees. You may want to consider saving your money until you are able to make a sizable down payment on your loan. This will help lower your interest rates and make the reality of owning a pool more feasible.

If you are able to make these payments now or have already saved up your money, now could be the right time to consider pool financing. Work with a lender to see how much you may be able to qualify for and what option is right for you.

Final Thoughts

Swimming pools can provide your family with years of summer fun, but they can also be a large financial investment. Between the installation and the ongoing maintenance, the numbers can be shocking. However, you don’t have to let the cost stop you from living out your summer dreams.

With the right pool financing, owning a pool doesn’t have to be out of reach. Consider how a home improvement loan can help get you into your dream pool this summer.

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