How to Finance a Pool

Are you longing for lazy summer afternoons spent floating in the sun or barbecuing by the water with friends? If so, pool financing could help you make it happen without dipping into your savings.

Before applying for a pool loan, you’ll need to know what costs to expect, the pros and cons of some typical financing options and what you might want to consider before borrowing.

How much does it cost to build a pool?

The cost of building a pool varies. Here’s what you can reasonably expect to pay for some common types of pools:^1,2

• Above-ground: $1,000-$6,000
• In-ground vinyl: $20,000-$40,000
• In-ground fiberglass: $20,000-$85,000
• In-ground concrete: $35,000-$120,000

Aside from the type of pool, other factors that will impact the cost of your project include:

• Location: Weather or soil conditions may make installation more or less expensive.
• Finishing materials: The type of decorative materials you pick can affect your total cost. For example, using simple ceramic tiles for decoration will cost less than a complex custom mosaic.
• Features: Adding certain features like lighting, fountains or a built-in spa can make your pool area more unique and enhance your swimming experience.
• Labor: How much you spend on labor depends on how complex the project is and the installation company you work with. Building a pool on an uneven spot or with lots of custom finishes could also raise your labor costs.
• Local requirements: You’ll likely need a permit from your city or county before starting construction, which can cost several hundred dollars or more.³ You may also need to get an inspection, which could cost another $125-$250.⁴

You’ll also want to look into the ongoing expenses for the type of pool you’d like to build. You may need to budget for things like:

• Utilities: Your water and electricity bills may be higher due to filling and running your pool.
• Chemicals and cleaning: Routine treatments and water-quality supplies keep the water safe.
• Repairs: Plan to fix liners, filters or pumps as they wear out.
• Insurance: Your monthly homeowner's insurance premium may increase when you add a pool.⁵

Recurring costs will vary depending on the size and type of your pool and how often you use it.

4 ways to finance a pool

Financing lets you spread the total cost of a pool into monthly payments, instead of paying the full price upfront. You may be able to finance the installation of a pool by taking out a personal loan, tapping into the equity you may have in your home, or enrolling in a payment plan offered by the pool company. The best option for you will depend on your credit score, budget, and how you prefer to manage payments.

1. Personal loan or pool loan

A pool loan is a personal loan that can be used to build or maintain a swimming pool. With predictable monthly payments, a fixed interest rate, and a clear timeline to pay off, you’ll always know exactly what you need to pay and when. If you’re approved for a pool loan from OneMain, you may also get fast access to funds — possibly as quick as one day^† — so you can start spending sunny afternoons at the poolside sooner.

A personal loan can be secured or unsecured. A secured personal loan is backed by collateral, which is something of value you possess, like a car, while an unsecured loan is not. If you don’t repay a secured personal loan, the lender has the right to take possession of your collateral to recover what you owe.

Choosing a secured personal loan may help you qualify to borrow more money or get a lower interest rate. If you have a less-than-perfect credit score, you may be more likely to get approved for a secured personal loan than an unsecured personal loan.

Prequalifying for a loan could give you a preview of the potential terms of secured and unsecured loans you may qualify for without submitting a full loan application. Prequalifying usually includes a soft credit inquiry, so there’s no impact on your credit score.

2. Home equity loan

A home equity loan, also known as a second mortgage, lets you borrow against the equity you’ve built in your home. Equity is the difference between what you still owe on your mortgage and the current market value of your home. With a home equity loan, you receive a lump sum upfront, then repay it in predictable monthly payments over a set period of time. You may need to pay appraisal fees, which can range from $300 to $500.⁶

One major drawback of a home equity loan is that your home is on the line as collateral. If you’re unable to make your loan payments, you could lose your home.

Still, a home equity loan may be appealing to some borrowers, since interest rates tend to be lower than unsecured loans.⁷

3. Home equity line of credit

A home equity line of credit (HELOC) is another way to borrow against the equity in your home. The lender sets a credit limit based on the equity you’ve built, and you can draw from it as needed over a set period of time known as the draw period.⁸ During this time, you’ll have to make minimum monthly payments based on how much you’ve drawn so far.

Once the draw period ends, you enter the repayment period. At this point, you won’t be able to borrow any more funds. Instead, you’ll repay your full balance, either in monthly payments or one lump sum, depending on your lender.⁹ HELOCs usually have a variable interest rate, so your payments could change from month to month.¹⁰

Like a home equity loan, a HELOC is backed by your home. If you aren’t able to repay what you borrow, you may face foreclosure.

4. Pool company financing

Some pool companies offer in-house financing or partner with third-party lenders. Repayment terms and interest rates can vary from company to company. Consider getting a personal loan quote to compare what the pool company offers. That way, you can see which option may be more affordable.¹¹

What to consider before financing a pool

Careful planning about the type of pool and extras and your budget can help you enjoy your pool without worrying that loan payments will stretch your finances too far in the future.

• Set a realistic budget: Pool projects often involve costs beyond the pool itself, like permits, landscaping and decking. Building the extras into your budget from the start may help you keep surprise expenses to a minimum.
• Get multiple quotes from pool companies: Comparing estimates for labor and materials can help you avoid overpaying and choose the option that fits your budget.
• Shop around with lenders: Looking at prequalified offers from more than one lender could help you find the right interest rate and repayment terms for your project.
• Factor in long-term costs: Pools need regular upkeep. Even routine maintenance can add up, but over the years, wear and tear may also lead to expensive repairs. It’s important to leave enough wiggle room in your budget to cover these costs as they arise.
• Impact on home value: If you plan to sell your home in the future, consider whether adding a pool is worth the investment. Depending on your neighborhood, a pool may or may not increase your home’s resale value.¹²
• Know where your credit stands: Your credit score could influence your eligibility, interest rate, and repayment terms for all types of pool financing. Consider checking your credit score before applying.

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Make a splash on your terms

Explore your pool financing options carefully to find terms that work best for you. Choosing a favorable financing option is just as important as choosing the right pool for your lifestyle. With a trustworthy lender on your side, you can build the backyard retreat you’ve been waiting for while keeping your budget on track.

Sources

1 https://www.angi.com/articles/how-much-does-installing-above-ground-pool-cost.htm
2 https://www.nerdwallet.com/article/mortgages/inground-pool-cost
3 https://www.angi.com/articles/how-much-does-building-permit-cost.htm
4 https://www.angi.com/articles/do-i-need-pool-inspection.htm
5 https://www.bankrate.com/insurance/homeowners-insurance/home-insurance-and-renovations/#renovations-that-increase-home-insurance-rates
6 https://www.experian.com/blogs/ask-experian/how-much-are-home-equity-loan-heloc-closing-costs/
7 https://www.bankrate.com/loans/personal-loans/personal-loans-vs-home-equity-loans/#vs
8,9,10 https://www.consumerfinance.gov/ask-cfpb/what-is-a-home-equity-line-of-credit-heloc-en-107/
11 https://www.nerdwallet.com/p/best/mortgages/best-pool-financing
12 https://www.bhg.com/does-a-pool-increase-home-value-8607922