Last updated on February 9, 2023

Financing a bathroom remodel isn’t as hard as people make it out to be!

There’s no shame in financing a big bathroom remodel project. But all too often, it can be hard to have conversations about it.

Here at Homeworx, we get it, and that’s why we’re very intentional about pricing and how we talk about it. We don’t want our customers to feel embarrassed or confused; we want you to feel empowered to get your home remodeled for a price you can afford and easily finance.

This breakdown of ways to finance your next remodel project should help you feel confident and prepared when you need to finance a project.

How Much Do Bathroom Remodels Cost?

Every year remodel costs fluctuate, depending primarily on materials and labor costs. But bathroom prices also reflect the bathroom remodeler’s overhead and profit. So, it’s not as simple as saying that a bathroom remodel costs “x” amount of dollars.

That being said, most homeowners report spending an average of $12,000 or more on their bathroom renovations. Keep in mind that this number can (and likely will) go up or down, depending on the unique needs of your bathroom remodel project.

Bathroom remodeling financing plans. How to finance and work through the number

Bathroom Financing Options for Homeowners

Many homeowners don’t realize how many financing and payment options there are for them. Endless doesn’t quite describe it well, but there are nearly endless combinations of ways to pay for a remodel or renovation.

Financing for homes is broken down into two categories:

  • Secured Financing Options
  • Unsecured Loan and Financing Options

Secured Financing Options

Secured financing normally refers to a specific asset that the lender secures if the borrower defaults. For example, for a home equity loan, you’ll receive a great rate on a loan, but in the instance that you’re unable to pay it back, the lender can collect the assets or the home that’s put up as collateral.

1) Home Equity Loans

A home equity loan is a popular way to finance bathroom remodels and other home improvement projects. Home equity loans are normally fixed rates, meaning the interest rate doesn’t change over the life of the loan, making it easier to budget and know how much you’ll have to pay.

Most lenders require borrowers to have at least 20% equity in their homes before approving a loan like this.

2) Home Equity Lines of Credit (HELOC)

Home Equity Lines of Credit, or HELOCs, allow homeowners to borrow money against the equity in their homes. This is a great option if you know you’ll need extra funds during your bathroom remodel project but don’t want to commit to a specific loan amount.

The downside of HELOCs is that they tend to have variable interest rates, meaning the rate can go up or down over time.

You also only have a certain amount of time that you’re able to borrow money for, and if you don’t use all the funds available to you during that timeframe, you’ll likely need to start the process over again.

3) Personal Loans

If you don’t have enough equity in your home to get a home equity loan or line of credit, consider taking out a personal loan. Personal loans can be secured or unsecured, meaning the lender can’t take any assets from you that you don’t put on the loan if you’re unable to pay back the loan.

Personal loans can have cars and other assets tied to them to provide collateral, and you’ll receive a better loan. If you don’t put up collateral, your loan will likely be less money with a higher interest rate.

4) Construction Loans

If you’re undergoing a larger remodel and want to take a different approach to finance the project. Construction loans are secured against the home itself, but they’re considered specialty financing.

These loans will allow you to take on a bigger loan with lower rates until the construction is completed. When the construction is finished, you’ll roll the loan into a permanent financing option.

5) RenoFi Loans

RenoFi is a specific lender that we put on this list because their product perfectly fits remodeling and renovation. Take your time and research this type of loan before you jump in too fast.

Unsecured Loan and Financing Options

Unsecured financing options always have higher rates and make it harder to borrow high volumes of money. When a loan is unsecured, there isn’t anything tied to that loan to ensure the lender will be paid if you default or choose to stop paying.

Credit cards are the perfect example. There are still consequences, but it’s not as severe or immediate as the consequence of secured loans.

6) Credit Cards and Credit Company Financing

When looking for unsecured financing, credit cards and credit companies are the best places to look. Credit companies will allow you to borrow a large amount of money at a high-interest rate, but it can be beneficial if you need the extra cash fast or if you want to take a smaller loan and repay it quickly.

The high-interest rates that these loans charge can really take their toll, so we encourage homeowners to stay away from them when possible.

7) Contractor Offered Financing

Contractor financing is the best of both worlds where you’re offered financing from the contractor, and you don’t have to work with any outside lenders. Why try to manage the third-party lending when you could work with your contracting to take care of all the financing needs.

The best part about it is that contractors often provide quick approval of your financing.

8) Energy Efficient Mortgages (EEMs)

If you’re looking to finance your bathroom remodel and make it more energy-efficient, an Energy Efficient Mortgage (EEM) might be a good fit for you.

EEMs are mortgages that allow homeowners to borrow money based on the increased value of their home after they’ve made energy-efficient improvements. These loans often won’t be for as much money, but they provide some financing.

9) Paying With Cash or Check

Cash isn’t necessarily a form of financing, but it is a way to pay for your remodel. If you have the cash on hand, paying for your bathroom remodel with cold hard cash is the best way to go.

It’ll help you avoid any interest payments, and you won’t have to worry about monthly payments or credit checks. If you don’t have the cash on hand, you can always use one of the methods above to get the money you need.


bathroom sink in a modern bathroom

Deciding What Financing Option is Right for You

Every project will need a different form of payment.

Talk with your contractor, credit company, or lender and see which one can offer you the best deal. You don’t want to be stuck in a bad situation where you can’t pay back your loan or your interest rates are through the roof.

Look through each of the options and their pros and cons. Here’s a list of all your options:

  • Home Equity Loan
  • HELOC (Home Equity Line of Credit)
  • Personal Loan
  • Construction Loan
  • RenoFi Loans
  • Credit Cards
  • Contractor Offered Financing
  • Energy Efficient Mortgages
  • Cash

Money-Saving Tips for Bathroom Remodels

No matter what bathroom remodel project you undertake, there are always ways to save money. In fact, we’ve outlined a few of our favorite tips below:

  • Get multiple quotes from contractors before hiring one
  • Compare prices on materials and products before making any purchases
  • Find creative ways to use old materials or fixtures in your new design

There are hundreds of ways to save money. If you really need to pinch pennies, take your time to find the right solutions to your problems.

Upgrade More of your Home All At Once

Another way to save money and spend less overall is to upgrade, renovate, or remodel more of your home all at once. Larger products take advantage of volume discounts from contractors and suppliers and save on installation costs.

Plus, when everything is done simultaneously, you’re able to enjoy your new home without having to go through more than one remodel.

Hire a Contractor You Can Trust

When it comes time to hire a contractor for your remodel project, you need someone you can trust to get the job done right.

It’s no small task to design and remodel a bathroom but our team of experts at Homeworx are ready and willing to provide you with the remodel you deserve for your bathroom at a price you can afford.

Contact Homeworx today for a free estimate!