One type of loan you might consider is a construction loan, and you can learn more about how construction loans work on our blog.
However, to finance home improvement projects that cost less than $100,000, you’re probably better off using another option. Construction loans are better suited for the building of a home from scratch.
You could also consider using a credit card for your home renovations. However, the interest rates on credit cards (and thus the interest payments) can end up being sky-high over the long run. If the reno is costly and you expect it to take you some time to pay off the credit card bill, you’re probably better off finding another source of cash for your home renovation, ideally one with lower interest rates, and one that won’t stand such a high chance of affecting your credit score.
Another popular option is to use a home equity loan or a home equity line of credit, also known as a HELOC.