Although they offer an incredible lifestyle and the prestige that comes with it, the fact is that inground pools are expensive. So what are your options if you don’t have the money to pay for the installation of an inground pool upfront? Can you finance inground pools? It’s certainly a possibility, but a possibility that depends on many factors. To help you work out if you could get a loan, or even if you’d want a loan, to pay for inground pool installation, we’ve come up with a list of things to think about.
Loan Types
There are three major loan types which would typically be available to you if you wanted to finance an inground pool: unsecured personal loans, home equity loans and independent financing.
The first type would be an unsecured personal loan from a bank, credit union or other financial institution. Unsecured personal loans don’t require collateral but do come with a higher interest rate compared to a home equity loan. Most unsecured personal loans need to be paid off within a few years, so their monthly payments can be high.
Home equity loans are based on the portion of your house that you’ve already paid off. Because there’s collateral involved, the interest rate is typically the lowest available. You’ll also have a much longer term to pay off the loan, so the monthly payments will be lower. However, if you default on the loan, your house could be at risk.
Independent financing can be offered by many different types of companies including some pool dealerships. However, the interest rates on these types of loans can be extremely high. Many reputable pool dealers won’t offer loans as it takes the focus away from their primary business.
Increased Property Value?
Many homeowners tell themselves that getting a loan is worthwhile because of the perceived increase in property value that will occur. However, this isn’t always the case. The ideal conditions for an increase in property value are if you live in a climate where you can swim all year round and in an upscale area where most other houses also have swimming pools. If your property doesn’t meet these conditions, you may not get your investment back when you decide to sell. This is something to think about before taking out a loan in hopes of making a capital gain.
Other Costs
Installation is only the beginning of the expenses related to the swimming pool. While you’re paying off your loan, you’ll also be paying to maintain the pool as well. This easily can add a couple hundred dollars to your monthly expenses. This should be taken into account before considering a loan. The last thing you want to do is elevate your monthly expenses so high that you can’t afford the lifestyle you’ve set up for yourself.
To find out more about planning your inground pool, download our backyard escapes guide.