Affordable Home Repair Loans for 2025
If you’re renting a place to live and stuff breaks or simply gives out, one call to the landlord might be what it takes to get the necessary repairs going. However, homeowners, while not burdened with rent, are burdened with constant home maintenance costs.
The average home repair and improvement costs are approximately $2,400 a year, and a large portion of those costs are emergency repairs, like water heaters or electrical malfunctions. Funding an unexpected home repair can be stressful, especially if you don’t have any money on hand to cover it, and your savings might have been drained by something else.
Fortunately, there are affordable home repair loans that can help cover the costs of repair, entirely or in part, without putting unnecessary financial stress on your home budget.
What Are Home Repair Loans?
Home repair loans are unsecured personal loans, and unlike home equity loans, these loans don’t require any collateral. Instead, your eligibility for the loan, as well as your interest rates, are completely dictated by your credit score. Naturally, a higher credit score implies lower interest rates and more favorable loan terms.
As these loans aren’t backed by collateral, the interest rates are often higher compared to secured financing, and loan repayment terms are often shorter and not as favorable. Borrowers are encouraged to carefully consider whether or not these loans are financially viable, especially since home equity lines of credit can be used for home improvement projects or home repairs and are often much more favorable.
However, HELOCs aren’t always an option, and home improvement loans (synonymous with home repair loans) do have their benefits, which we’ll cover in a later section of this short guide. For now, it’s important to note these loans work just like any other loan: you take a loan amount in a lump sum, which you repay through monthly payments, along with interest.
Benefits of Affordable Home Repair Loans
As previously mentioned, affordable home repair loans have some advantages over equity loans, and the primary advantage is that you don’t actually have to own at least 15% of your property, since the property isn’t used as collateral.
This means that the lender doesn’t have the right to seize your property if you miss payments or if you default on your loan; it’s important to note that this doesn’t exclude legal repercussions and potential collections.
Another benefit is fixed monthly payments, which allow you to budge said payment more reliably, especially if you’re under the low-income homeowner bracket. This implies fixed interest rates during the loan's life.
Another benefit is fast funding, as online loan applications for these financing options often take just a few minutes to complete, and funds often take days or two to become available, allowing you to start with your home renovations, upgrades, or repairs project.
Lastly, most lenders don’t penalize prepayment and even allow users to refinance the loan if necessary, so it’s vital to read the fine print of any loan program.
How to Get Home Repair Loans
Thanks to the rise of online accessibility, getting a home repair loan has never been easier; simply visit our website and apply for the loan. To qualify for the loan, you will have to deliver the necessary documents, such as personal ID, proof of address, proof of income, and your credit score; many of these loans have minimum credit score requirements.
Once you apply, the lender will go over your application to determine eligibility and approve the funding if you satisfy the qualifying criteria for the loan. Once the loan has been approved, the funds will be loaded into your bank account, and you can fund your home repairs. All you have to do now is repay the loan.
In the meantime, it’s also a good idea to check out the US Department of Housing and Urban Development (HUD), as they often offer resources that can help you plan and execute your home repair project more effectively.
Why Choose Our Affordable Home Repair Loans?
River City FCU is a DCFI and MDI-certified credit union that offers sensible financial products regardless of citizenship status and a focus on serving financially underserved communities. If you want to learn more about energy-efficient home loans, visit our E-Home Improvement page here.