Planning a domestic spruce up? Unless you’re lucky enough to have plenty of capital at your disposal or you call Kevin Mccloud a confidant, then you’re going to need a source of finance to fund your dream home renovation. As we all know, budgets can run away with themselves, underlying issues often emerge which need remedying, and tastes might change during a project. Proper financing, then, is essential. With that in mind, here are 4 IDEAL tips for funding your dream home renovation.


We’ve all seen those Grand Designs episodes when an ambitious, oblivious amateur attempts to build their dream home. And time and time again these budding architects come across the same problem – escalating costs. While we can all predict this eventuality from the sofa, being objective can be tough with your head under a hard hat and your knees deep in rubble. Yep, hidden costs are one of the biggest hurdles to completing home renovations successfully. Always add a recommended minimum contingency of 15% for unforeseen problems, overruns and even inflation.

Avoiding hidden costs starts with smart budgeting from the off. With so much to cover on this subject, we’ve written a whole other article on how to avoid spiralling home renovation costs in 5 steps here. Enjoy!



When it comes to funding your home renovation, there are lots of loan options out there. Unless you’re an accountant or loan advisor, getting your head around all the different types of finance available to you can be a massive headache.

For one, there’s bridging loans and bridging finance; usually a short-term loan which can ‘bridge’ the gap when you don’t have quite enough funding and are looking for more. Then there are personal loans which, for instance, can offer the chance to borrow up to £15,000 over five years and have a fixed repayment period. These loans, however, tend to be unsecured which means that the interest might be a little higher to mitigate the bank’s risk. What’s more, there are even loans specifically for home improvement and you could even consider an over-extended overdraft facility or credit card option.

The best thing to do is to consult with experts on the matter, rather than diving in headfirst and taking the first funding you feast eyes on.   


The addition of an extra building or the complete remodelling of a house can be pretty pricey, and if a repayment period of five years or under simply won’t suffice, fortunately, there are other options at your disposal. For these projects, it might be a good idea for the homeowner to tap into the house’s equity; the difference between the capital outstanding and the value of the property. Banks are often keen to finance this as it automatically provides security against the loan.

The experts at Sofi ( explain that the loan process for pulling cash out of your home is referred to as a ‘cash-out refinance’ or ‘cash-out refi’ for short. This means you’re essentially taking out a new mortgage loan for a larger amount than your existing mortgage and you’ll receive the difference in cash.

For homeowners, it’s important to remember to explore equity options via reputable institutions in order to get the best deals. Equity loans for renovation purposes can be done over the remaining term of the mortgage, or a fixed period as agreed with the financial institution. The norm is around ten years. However, unless a fixed rate has been booked and approved, the interest can fluctuate. This option is good if the finance period is ten years or more, or if the finance amount is high. Moreover, the interest rates on these loans tend to be a little more favourable than personal loans.



During your renovation, no doubt you’ll be up to your eyeballs in spreadsheets, paperwork and invoices, worrying about all those inevitable funding issues. We hate to say it, but now is not the time to live the high life, retreat to the Caribbean or indulge in some retail therapy to take your mind off things. Best to hunker down, hold tight and delay the gratification until your domestic space is functioning to its full potential.

Some top hacks for living a more frugal lifestyle include planning you meals in advance, bulk cooking and saving vouchers and coupons. You could even make a little money by selling any unwanted items that you no longer need in your soon to be dream home.

Speaking of saving, check our our 5 insider tips on simple ways to save money on your next home renovation.