Swimming pool loans are a subcategory of home improvement loans. These are classified as unsecured personal loans, differentiating them from secured loans, such as home equity loans. While there are other swimming pool financing options – such as bank financing, credit union financing, and second mortgages – swimming pool loans are available from companies that specialize in financing pools and other backyard renovation or home improvement projects.
Bank loans, mortgages, credit union financing, and home equity lines of credit have some distinct disadvantages. These loans usually take weeks, sometimes months, to pay out. The process involves a home appraisal, so if your neighbor’s house sold last year for $500,000, your bank may balk at appraising your property for $350,000, even with a pool. These loans require huge amounts of paperwork, and in the end, you’re putting your home and lot up for collateral for the loan. Additionally, banks and other mortgage lenders usually pay out in stages, called “stage funding.” This means you only get loan payouts as your pool builder completes specific stages of the project. There can be additional inspections to verify the stages have been successfully completed, further delaying your full loan payout, and by consequence, your completed pool project.
Swimming pool loans are available that do not require home appraisals, collateral (aka, your home), or stage funding. Since these companies deal specifically with swimming pool financing and other backyard renovation or home improvement projects, these loans are typically faster to process and quicker to pay out.
A swimming pool loan is usually classified as a personal loan. These are unsecured loans, meaning there is no collateral required. Collateral is real property, usually your home and property, that is used as a pledge by the borrower to protect the company lending the money. In an unsecured personal loan, such as swimming pool loans, you are not risking your home if for some reason you are unable to repay the loan.
Banks generally work with swimming pool loans only if you have a high income and excellent credit score. Credit unions will typically work with slightly lower credit scores, but offer higher rates. Online lenders come with a variety of benefits, including more flexibility when it comes to income, credit score, the value of your home, length of home ownership, and other factors that are sometimes tripping points for bank loans.
Pool loans are available at interest rates as low as 2.99% and with loan terms as long as 20 years. Loans up to $500,000 are available through HFS Financial. Many other lenders cap loans at $100,000. The higher amount is ideal for more complicated pool builds, and can also include other backyard renovation projects or other home improvements you wish to complete at the same time.
As the housing market gets tighter and tighter, many homeowners are realizing the value of improving their existing homes and backyards instead of trying to buy a new home. Houses in some markets are hard to come by, and are overpriced when available. Home improvement loans and swimming pool loans are a more affordable and less risky option for those who choose to improve where they live instead of trying to move.
Most pool lenders cap terms at 10 to 15 years, however, you can get a pool loan through HFS Financial with terms up to 20 years. This gives you longer to pay on the loan, meaning that your monthly payments are significantly lower.
The average prices of inground pools vary considerably from state to state and city to city. Additionally, the worldwide supply chain issues over the past few years have affected the cost of inground swimming pools. Until you get the estimate from your pool builder, it’s hard to predict how much your pool will cost. The price depends on your pool design, your location, and your backyard. In 2022, you may be able to build a modest inground pool for less than $50,000 while a luxury pool can cost well over $100,000.
If you live in a drought-prone area, it’s comforting to know that an inground pool actually consumes less water per year than if that same area were landscaped. Pool owners don’t considerably increase their water consumption over those who maintain lawns.
Different pool lenders require different credit scores. Typically banks and credit unions require higher scores than online lenders. HFS Financial can work with credit scores of 600 or higher. No matter what swimming pool financing company you choose, higher credit scores qualify for lower interest rates. HFS Financial currently offers rates starting at 2.99%. This is subject to change depending on the prime rate at any given time.
Applying for a pool loan is simple and fast online. Look for a lending company that can give you a pre-approval with only a soft hit on your credit report. This assures that merely checking for a loan doesn’t affect your credit. Also, try to avoid companies offering stage funding. That way you control your funding and have cash in-hand to get the project started and to pay your pool builder once your pool is complete.
Some builders partner with HFS Financial, so you can get your lending directly through your pool builder’s website. It’s a simple form to get pre-approved and get your loan process started. If your pool builder has not partnered with HFS Financial, you can apply directly on the HFS website.
The initial form takes just a few minutes to complete. Your customer service representative will reach out for any additional questions or paperwork required to process your loan. Swimming pool loans can fund in as little as 24 hours in many cases. If your pool loan underwriter has additional requests, these can usually be handled quickly and efficiently online or via a phone call.
Your swimming pool loan payments and interest rates depend on a number of factors:
You can quickly and easily determine your pool loan rate here.
HFS Financial hopes that you and your family are absolutely thrilled with your new swimming pool. We make the lending part easy, so the rest of the pool buying process is as smooth as possible. You Dream It, We Finance It.