In the present financial climate, it is prudent to make judicious decisions regarding home improvement financing. Leveraging a well-thought-out financial strategy can ensure that you enhance the value of your home without straining your financial resources. Here, we delve into various avenues and practical steps that can guide you in successfully navigating the landscape of home improvement financing.

National Home Improvement Month (NHIM) is the UK’s highest-profile home improvement awareness campaign. It takes place in April 2023 and aims to inspire millions of homeowners and renters to make a single change to their homes to help them love the home they live in.

Last year, over 17 million adults across the UK were inspired to make a single change to their homes. In 2023, the goal is to inspire even more people to take on a home improvement challenge.

The most popular room for improvement is the kitchen, followed by the bedroom and the living room. But no matter what room you choose to improve, NHIM is the perfect time to get started.

Here are a few ideas for home improvement projects you can do in September:

  • Give your kitchen a makeover with new cabinets, countertops, and appliances.
  • Create a relaxing oasis in your bedroom with new bedding, curtains, and artwork.
  • Transform your living room into a space where you can entertain guests or relax with family.
  • Update your bathroom with new tiles, fixtures, and a fresh coat of paint.
  • Add some smart home features to your home, such as voice-activated lights or thermostats.
  • Improve the energy efficiency of your home by installing insulation or solar panels.

In truth, of course, and depending on the house you live in, you will have your own list of priorities when it comes to home improvements.

Apart from those priorities, one of your major concerns is likely to be how you are going to pay for the works themselves. Have you considered a remortgage for home improvements, for example? Let’s briefly run through some of your options:

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What is Remortgaging for Home Improvements?

Remortgaging for home improvements is when you take out a new mortgage to release equity in your home to pay for home improvements. This can be a good option if you have enough equity in your home and can afford the repayments on the new mortgage.

There are two main ways to remortgage for home improvements:

  • Remortgaging with a higher loan-to-value (LTV) mortgage. This means that you borrow more money than the value of your home. This can be a good option if you have a lot of equity in your home and can afford the higher monthly repayments.
  • Remortgaging and taking out a personal loan. This means that you take out a separate loan to pay for the home improvements. This can be a good option if you don’t have enough equity in your home to qualify for a higher LTV mortgage.

There are a few things to consider before remortgaging for home improvements:

  • The cost of the home improvements. Ensure you have a clear idea of how much the home improvements will cost before starting the remortgaging process.
  • The interest rates on the new mortgage. Make sure you compare the interest rates on different mortgages before you choose one.
  • The early repayment charges. Some mortgages have early repayment charges, so you’ll need to factor these into your decision.
  • The length of the new mortgage term. The longer the term, the lower your monthly repayments will be, but you’ll pay more interest overall.

If you’re considering remortgaging for home improvements, it’s important to get independent financial advice to ensure it’s the right decision.

Here are some of the benefits of remortgaging for home improvements:

  • You can get a lump sum of money to pay for the improvements.
  • You can spread the cost of the improvements over a longer period of time.
  • You can improve the value of your home.

Here are some of the risks of remortgaging for home improvements:

  • You may have to pay higher interest rates.
  • You may have to pay early repayment charges.
  • You may have difficulty getting a mortgage if you have a lot of debt.

Overall, remortgaging for home improvements can be a good way to fund your renovations, but it’s important to weigh up the benefits and risks before you make a decision.

Examining the Different Financing Options


  • Pros
    • No Borrowing Required: Utilising your savings means that there’s no need to borrow, thus saving you from potential interest costs.
    • Maintain Control: Leveraging your savings gives you complete control over your funds, ensuring no debt or additional obligations.
  • Cons
    • Depletes Savings: Tapping into your savings can diminish the financial cushion you have built over time, potentially leaving you with limited resources for other needs.

Credit Card

  • Pros
    • Ease and Convenience: Credit cards offer a convenient way to swiftly finance smaller home improvement projects.
  • Cons
    • High-Interest Rates: Credit cards usually come with high interest rates, potentially significantly increasing the cost of your home improvements.
    • Limit on Expenditure: The spending limit on your credit card can cap the amount available to fund your home improvement needs, potentially restricting other purchases.

Personal Loan

  • Pros
    • Favourable Interest Rates: Compared to credit cards, personal loans often offer more favourable interest rates, helping you to spread the cost of home improvements over a more extended period, generally five to six years.
  • Cons
    • Potentially High Interest: Even though the rates are lower than credit cards, the interest rate on an unsecured personal loan might still be higher than you would prefer.

Second Mortgage

  • Pros
    • Competitive Interest Rates: Securing a loan against your home can result in access to more competitive interest rates, thanks to the increased confidence and reassurance it affords the lender.
    • Access to Substantial Funds: Leveraging the equity you’ve built up in your property allows you to secure substantial funding for your home improvements.
  • Cons
    • Increased Risk of Repossession: Taking on a second charge increases the risk of your home being repossessed if you find yourself unable to meet the repayments.
    • Further Financial Commitment: If you are barely meeting the monthly instalments on your current mortgage, taking on additional debt might not be advisable as it heightens financial strain.


  • Pros
    • Potentially Lower Interest Rates: As highlighted by Which? magazine, careful comparison of interest rates might reveal that remortgaging can offer a more attractive rate than a second mortgage, especially if your current mortgage rate is low.
    • Flexibility: If your credit rating has changed adversely since your initial mortgage arrangement, a careful assessment of your options could still position remortgaging as a viable choice depending on individual circumstances.
  • Cons
    • Early Repayment Charges: Remortgaging can incur high early repayment charges on your current mortgage, necessitating a thorough comparison of potential costs and benefits.
    • Complex Considerations: Navigating the pros and cons of remortgaging can be a complex process requiring a nuanced understanding of the potential implications for your individual credit history and circumstances.


If you are looking to improve your home, therefore, there are a number of options when it comes to financing the project. If you are borrowing the money, of course, you are likely to get the most competitive rate of interest by securing any loan against your property – but you must remember that it remains at risk if you default on the repayments. If you choose to borrow against your home, you need to carefully compare the relative advantages of arranging a second mortgage or remortgage. We would suggest you to contact specialist mortgage broker to help you with the application process.

Damian Youell

Feel Free To Start WhatsApp Chat With Us...

How We Work

1: We contact you and take down your details, income outgoings, name, address etc.

2: We will research the whole market and email you a detailed quote as well as a list of documents to proceed.

3: You upload the documents and information needed via our channel our online portal.

Feel Free to Contact Us

FAQs- How to Pay for Home Improvements

How do I fund my home improvements?

There are various ways to fund your home improvement project. Depending on your personal circumstances and the size of the project, you may opt for a personal loan, a secured homeowner loan, or even a credit card for smaller projects. It is important to review the interest rates and terms for each option and select the one that suits your financial circumstances best.

What should I consider when planning the financing for my home improvements?

Consider your budget, the improvement loan rate, and your credit score. Factor in the potential increase in house price due to the improvements and evaluate if taking a loan for the improvements will add value to your home in the long term. Always plan for unexpected costs and have a contingency budget in place.

Can I get a grant for energy-efficient home improvements?

Yes, there are grants available for energy-efficient home improvements, including government schemes encouraging the installation of solar panels and double glazing. Check with your local authorities or building society for advice on the grants available in your region.

How can I find the right mortgage deal for home improvements?

It is recommended to speak to a mortgage advisor or building society to explore the best mortgage deals. The right mortgage deal will depend on your individual circumstances, including your current mortgage terms, credit score, and the extent of the improvements planned.

FAQs- Remortgaging for Home Improvements

Is it a good idea to remortgage to fund home renovations? Remortgaging can be a viable option if you find a mortgage deal with a lower interest rate, which could potentially save you money in the long term. However, consider the additional costs, such as a potential early repayment charge on your current mortgage. It is essential to weigh the pros and cons based on your financial circumstances.

Are lenders open to extending the mortgage for home improvements?

While many lenders are open to offering additional borrowing for home improvements, it is not a guarantee. Lenders will consider your credit history, current income ratio, and the value that the improvements will add to your property before approving an additional loan.

FAQs- Equity Release for Home Improvements

Should I consider releasing equity for my home improvement project?

Releasing equity through an equity release plan can be a suitable option, especially if you are looking at larger projects. It allows you to access the tied-up funds in your home. However, it is important to understand the terms, including any potential impact on your personal circumstances and future inheritance.

What are the potential downsides of equity release?

While equity release can provide substantial funds, it comes with drawbacks such as reducing the value of your estate and possibly affecting your entitlement to state benefits. It might involve larger repayment amounts in the long term. Discussing your options with an equity release provider can offer clarity on the best route to take based on your individual circumstances.

FAQs- Loans and Credit Cards for Home Improvements

What are the options available if I am considering a home improvement loan?

You can opt for an unsecured personal loan or a secured home improvement loan based on your credit score and financial standing. The type of loan you choose will influence your loan term and monthly repayment structure, so choose an option that aligns well with your financial stability.

Is it advisable to use a credit card for home improvements?

Utilising a credit card can be a quick and convenient way to fund smaller improvement projects. Some cards offer interest-free periods, giving you the flexibility to repay without incurring interest for a set period of time. However, be cautious of the credit limit and try to maintain a good credit rating by making timely repayments.

FAQs- Considering the Costs and Benefits

How can I ensure my home improvements add value to my home?

To add value to your home, focus on improvements that enhance its aesthetic and functional aspects. Projects like loft conversion, modernising the kitchen or bathroom, and installing energy-efficient systems tend to offer good returns on investment.

How can I save on my home renovation project?

Saving on your home renovation project can be achieved through meticulous planning. Obtain quotes from various contractors, consider potential DIY aspects, and keep an eye out for discounts on materials. Moreover, opting for energy-efficient improvements can earn you grants and long-term savings on energy bills.

Remember that these answers are meant to be informative and that it’s always best to consult with a financial advisor or lender to understand all your options fully, taking into consideration your personal circumstances.


About The Author

mortgage broker damian youell

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Damian is an experienced mortgage broker, founder of Ltd and company director. With over a decade working as a mortgage broker he has a strong understanding of hard to place mortgage cases. With hundreds of 5 star client reviews. hundreds of repeat clients his work speaks for himself.

He started as a one man band with the philosophy of putting clients needs ahead of his own. This ethos of offering excellent customer service has helped the business grow over the years. He gets satisfaction on getting cases pushed through to offer stage where other mortgage broker and companies have failed.

Throughout his time as an adviser he has carved out a niche area of advice helping clients with their business protection requirements too. Having helped hundreds of client with Relevant Life Policies, Shareholder Protection Insurance, Keyperson Policies and other important protection requirements of large to small businesses.

At home he is a family man and likes to spend his time with his four children and wife Lisa. He enjoys going on holidays spending time with friends and going for walks.