While you may not spend as much time in your bathroom as you do in, say, your family room or kitchen, bathrooms can still play a huge role in how much you enjoy your home. A deep soaking tub that lets you escape from the stress of work and life can be a major plus, whereas hopping in a cramped shower with rusty, outdated features is unlikely to help you relax. Plus, everyone enjoys bathrooms that have plenty of storage space and a modern design, right? You may not spend hours in your bathroom every day, but you can’t really avoid it, either.
The problem? Bathroom renovations are far from cheap. Remodeling Magazine’s 2019 Cost vs. Value Study notes that, on a national level, even a mid-range bathroom remodel or small bathroom remodel will cost an average of $20,420.
And the bathroom remodel cost just goes up from there; Remodeling’s statistics show that upscale bathroom renovations cost $64,743, on average.
Why are costs so high? There’s a lot that goes into bathroom renovations that can cause the average bathroom remodel costs to balloon.
A major remodeling project may mean taking the walls down to the studs, rerouting plumbing and adding new drywall, electrical and fixtures. Then there are the big components of a remodel — a new soaking tub, shower, glass shower door, tile and vanity, as well as flooring and labor costs. When you add it all up, the costs can put you in a financial bind if you don’t have the money to fund the renovation.
How to finance a bathroom remodel
Fortunately, you don’t have to pay for it all at once. If you’re ready to remodel your bathroom because you need more space or it’s outdated and desperately needs an upgrade, you’re probably wondering about the best ways to finance this project. The good news? There are several options to consider — each of which has its own set of pros and cons.
Best option: Using a personal loan to remodel your bathroom
Personal loans come with fixed interest rates, a fixed repayment timeline and a fixed monthly payment that will never change, making them easy to plan for. If you have great credit, you can also qualify for a personal loan with a rate as low as 4 percent APR and no origination fee or hidden fees.
Another benefit of using a personal loan for bathroom renovations is that, unlike other borrowing options, you don’t have to put down collateral, such as your home. And since personal loans are unsecured, the application process is usually much less involved so you can get your money sooner.
The best part about personal loans, however, is the fact you can research options, apply online and get funding without ever stepping into a bank.
Who personal loans are best for:
Consumers who want to complete a bathroom remodel without borrowing against the equity in their homes or putting down other forms of collateral
Anyone with great credit who can qualify for a loan with the best rates and terms
Someone who wants an “easy” loan process and the option to get the funds within a few business days
An alternative: Consider a home equity loan or HELOC
Another financing option for homeowners who want to spruce up their bathroom is a home equity loan. Like a personal loan, home equity loans come with fixed interest rates, a fixed repayment term, and a fixed monthly payment. The difference, however, is a home equity loan requires you to pledge your home as collateral. This type of loan also lets you qualify for a low rate if you have good credit and plenty of home equity since the loan is secured by your property.
Home equity lines of credit, or HELOCs, also require you to use your home as collateral, but they work a different way. Instead of giving you a fixed loan amount, you get a line of credit you can borrow against — typically with a variable rate. Like home equity loans, HELOCs tend to come with low rates and fair terms since you’re using your home as collateral.
Home equity loans and HELOCs are best for:
Consumers who have a lot of home equity since you can typically only borrow up to 85 percent of your home’s value in total with a first mortgage and second loan
Someone who doesn’t mind putting up their home as collateral, even knowing they could face foreclosure if they don’t repay and default
Borrowers who want to use their home’s growing equity to finance home improvements
One final option: Check out certain types of credit cards
Also consider the prospect of getting a credit card for your bathroom remodel — but not just any credit card. Some balance transfer credit cards, which can also be called “0% APR credit cards,” come with 0 percent APR on purchases for up to 18 months.
The upside of using one of these offers is the fact you’ll pay zero interest during your card’s introductory offer. But since these offers don’t last forever, you need to have a plan to pay off the entire bathroom remodeling cost before your interest rate resets to the regular rate.
If you still have a balance when the zero percent period ends, you could suffer sticker shock. Let’s say you have a $10,000 balance remaining on your card when your 0 percent offer expires. If your APR resets at the current average credit card rate of 17.8 percent, you would potentially owe $1,780 in annual interest, or about $148 per month.
Another feature to look for with these offers is rewards, since many cards give you cash back and 0 percent APR on purchases for a limited time. If you can pay off your bathroom remodel fairly fast, earning rewards and avoiding interest can be a win-win.
0% APR credit cards are best for:
Someone who needs to borrow only enough for a small bathroom remodel and who can pay their balance in full before their introductory offer ends
Consumers who have excellent credit and can qualify for the best credit card rates
Someone who has the discipline to stick to a repayment plan that helps them avoid long-term debt
The bottom line
Bathroom remodeling projects tend to be pricey, but they can be well worth it since you’re improving one of the spaces you use the most and future buyers deem important. Still, the best bathroom projects are ones that have been thought out and planned for, including both the project itself and its costs.
Make sure to compare the options on this list to find the right loan for your needs, and your remodeling plan is sure to go off without a hitch.
Best home improvement loans
How to pay for home improvements
How to use equity for home improvements