Swimming Pool Loans 101

Written by Michael Dean
April 14, 2023

computer showing a swimming pool loan form

Swimming pool loans can help you finance a new centerpiece for your backyard. A swimming pool loan refers to any loan from a financial entity meant to assist in constructing and maintaining swimming pools.

This article will explore the various lending platforms. It will also examine the types of swimming pool loans available to homeowners. Also, it will offer insights into credit scores, repayment periods, and application procedures. If you haven’t yet, be sure to read my guide on how to finance a pool as well.

Disclaimer: This is not financial advice, and I worked with a certified financial planner to create this article. Full disclaimer at the bottom.

Skip ahead:

  1. Where Can You Get a Swimming Pool Loan?
  2. How Swimming Pool Loans Work
  3. What to Consider When Comparing Swimming Pool Loans?
  4. Frequently Asked Questions

Main Takeaways

  • You can get a swimming pool loan from online lenders, banks, and credit unions.
  • There are four types of swimming pool loans: home equity loans, personal loans, in-house financing, and HELOC, with most people getting personal loans or home equity loans.
  • Swimming pool loans give you flexibility, favorable interest rates, and require no collateral. However, they require high credit scores and can be very stressful.
  • You should consider the approval process, extra charges, and the borrowing amount when comparing swimming pool loans.

Where Can You Get a Swimming Pool Loan?

There are many places where you can get swimming pool loans. Each one of them has its features, terms, and loan rates. Most people prefer online lending platforms because their pre-qualifications are lenient. And, even if you fail to pay them back, your credit score won’t be affected.

Online Lenders

Many online platforms offer swimming pool loans. Here are their pros and cons.


  • Provision of Enough Amount: These lenders offer swimming pool loans and home improvement funds to eligible homeowners. Successful applicants can expect to receive about $100,000, some of which will cover the cost of constructing and maintaining a swimming pool.
  • Low Interest Rates: You can expect to repay about 5% of the borrowed amount every month. Generally, the majority of people get about $20,000 to finance swimming pool construction and improvements.


  • Short Repayment Periods: Most online platforms offer loans of about $40,000. Unfortunately, these ones have very short repayment periods.
  • Presence of Origination Fees: These make online platforms a less attractive option, especially when you realize that they also charge origination fees.


You can contact a bank if you fail to secure a swimming pool loan from an online lender. Here are the pros and cons of getting a swimming pool loan from a bank.


  • Provide High Amount: Most people’s first destination is the major banks in the U.S. Banks can provide swimming pool loans of about $100,000.
  • Discounts: Current customers have an additional advantage since they can qualify for discounts.
  • Ability to Apply Online: While new customers must go to a physical branch to kick-start the application process, current customers can make the application on the phone or online.
  • Special Offers to Veterans: Some banks provide swimming pool loans to military members and their families. These loans are called personal loans because they can cover any home improvement project. Consequently, if you are a current member of the U.S. Army, you can apply for a loan of about $50,000, which you can use to build a new swimming pool.


  • Requires High Credit Scores: You must have a strong credit score to access the most affordable interest rates and repayment returns.

Credit Unions

Credit unions have meager interest rates and extended repayment periods. Here are their pros and cons.


  • Cater for People With Low Interest Rates: Credit unions are very lenient when it comes to serving people with bad credit scores.
  • Have Special Offers for Servicemen: Members of the public and military members can request loans of about $50,000 to finance the construction of a new swimming pool.
  • Extended Repayment Period: The repayment period is usually about five years.


  • Excludes other People: You must be a member of that credit union, reside in their region of operation, and work in a specific industry to apply for these loans.

How Swimming Pool Loans Work

Swimming pool loans work differently depending on the type of lender. Here is how each type of swimming pool loan works.

Home Equity Loans

You can apply for a home equity loan if you have equity in your house. This means that your house will serve as the collateral for the loan. Banks allow you to borrow about 85% of your home’s value, provided that you don’t have existing mortgage debt.

For example, if your home’s value is $300,000, and you have an additional mortgage of $200,000, the bank will lend you a maximum of $50,000. Other banks may lend you a higher amount, but they will enact high-interest rates.

Financing your swimming pool using home equity loans is a great option, but it has its problems. The most significant issue is that you are looking at foreclosure if you fail to make the agreed repayments on time. Sometimes, you may need to sell your home to repay the swimming pool loan. Failure to repay a home equity loan will also negatively impact your average credit score. Eventually, you may end up losing money.

Personal Loans

Personal loans are preferred because you can use them for any purpose. Moreover, since many institutions offer personal loans, finding specific loans with favorable terms is easy. You can choose a variable-rate personal loan or a fixed-rate personal loan. Also, most personal loans are available online.

Generally, personal loans have very high-interest rates than other types of swimming pool loans. This is a minor disadvantage because you can quickly get personal loans without providing any security. On the other hand, home equity loans have low-interest rates, but you must come up with a guarantor.

Before you consider applying for a personal swimming pool loan, you should consult a financial expert. Also, you should take a loan that is within your financial capability. If you fail to pay the loan, you may lose some of your assets.

In-house Financing  

Some construction companies can build the pool for you as a loan. This means you will pay the construction company a specific amount of money every month. Of course, this amount will be higher than the construction company used to construct the swimming pool. This type of arrangement is called in-house financing.

Unfortunately, it isn’t easy to find pool construction companies offering in-house financing because they are not conversant with lending terms. Even if you find one, their interest rates will be exorbitant and unfavorable to a low-income person.


A home equity line of credit is the perfect way to find funds for swimming pool construction. It shares many similarities with a home equity loan, but it has some differences as well. Perhaps the main difference is that you can borrow against a specific line of credit. Besides, the interest varies based on several factors. As a result, the amount of money you will pay in the end isn’t fixed but depends on market fluctuations.

It is not a great idea to finance your home using a home equity line of credit. For example, you must use your home as collateral for the loan. You will be staring at a foreclosure when you fail to pay the loan. Also, the variable interest rate can fluctuate upwards.

Pros and Cons of Swimming Pool Loans

Swimming pool loans have many advantages, but all are not rosy; they have some disadvantages too.


  • Flexibility: Unlike other loans that must be used for a specific purpose, you can use a swimming pool loan for other home renovation projects.
  • Favorable Interest Rates: The average interest rate stood at 12% by the end of 2020. This is quite low compared to the average mortgage rates, which stand at 16%. Moreover, if you have a high credit score, your interest rate can go as low as 5%.
  • Requires No Collateral: Swimming pool loans are also popular because they require little or no collateral. Although you must have a high credit score to qualify for mortgages and car loans, you can access swimming pool loans with a low credit score. For example, if you choose personal loans to finance your swimming pool venture, you will not be required to put your house as collateral, even if you have a low credit score.


Unfortunately, not everybody sees the attractiveness of swimming pool loans. Other people had bad experiences when they took swimming pool loans. Here are the cons of taking these loans.

  • Requires High Credit Scores: Low-interest rates are not available to people with poor credit scores. Research has shown that if you have a credit score of less than 650, your interest rates may be more than 30%.
  • Penalties and Fees: Another major disadvantage is the rampant penalties and fees associated with swimming pool loans. It’s not surprising to find that most swimming pool loans come with origination fees of about 5%. These origination fees are supposed to cater to the loan application process. This means that you already owe the bank money before they give you the loan. Similarly, penalties may accrue if you fail to pay the loan within the stipulated time.
  • Can Be Stressful: The existence of fixed monthly loans means that you must pay a specific amount of money every month. These monthly payments can run for up to 10 years. Ultimately, the swimming pool loan will become a stressful thing in your life.

Personal Loans vs. Home Equity Loans to Finance Your Pool

Personal loans and home equity loans are the main ways to finance the construction of swimming pools. Most people go for personal loans after failing to secure home equity loans. Others may go for personal loans because they don’t want to use their home as a guarantor.

You will get many benefits when you decide to use personal loans for swimming pool financing. Typically, personal loans have no upfront fees, and those that do charge very low origination fees.

Once you get approved for the loan, you will encounter less paperwork and requirements. Some people have reported that they could get their money on the same day they applied for the loan. This is a great advantage because you can immediately start the construction of your swimming pool.

One of the reasons people go for home equity loans is that they can receive a high amount of money. However, you risk losing your home if you cannot repay the loan. This is not something you have worry about when you take a personal loan.

While getting a personal loan is easier and quicker, the interest rates are incredibly high. On the other hand, home equity loan interests are lower because you have already provided a security deposit. You may also be eligible for tax refunds because the government taxes home equity loans. This means that once the IRS determines that you used a loan to acquire or improve your home, it can offer you tax refunds.

What to Consider When Comparing Swimming Pool Loans

You should consider several factors when applying for a swimming pool loan, as highlighted below.

Approval Process

A high credit score is an asset when you are applying for any loan. You must consistently work on your credit score because it will increase your chances of getting approved for a swimming pool loan. Besides, a good credit score will lead to favorable interest rates and loan repayment periods.

Extra Charges

The process of owning a swimming pool does not end after construction has been completed. You will need to spend about $750 every month on swimming pool maintenance. This amount will increase during the summer. You should also be aware that there will be other charges, such as insurance and safety measures.

Borrowing Amount

There is no definite borrowing amount since each person has their personal preferences. Similarly, it would help if you kept in mind that you can’t factor in the home value because swimming pools have a low return on investment.

Essentially, you can’t look at a swimming pool as an investment. Instead, this luxury item will cost you a lot of money, but it will bring little to no financial returns in terms of value for your home. Remember that if you are borrowing money to finance it.

The expected monthly payments and interest will determine the amount of money you are willing and able to borrow for your swimming pool. Keeping the total costs of the loan within your current financial capability will prevent an inevitable financial catastrophe.

For example, it wouldn’t make sense to invest in a swimming pool costing $100,000 if your annual income is $200,000. You will find it very difficult to meet your monthly financial obligations while repaying the loan. Therefore, the type of pool you choose to construct should be within your reach.

What Credit Score Do You Need to Get a Pool Loan?

There is no specific minimum credit score that you need. People with credit scores of less than 640 can access personal loans. Nevertheless, it isn’t easy to access personal loans with a credit score of less than 700. It’s important to remember that low credit scores significantly increase your interest rates.

Can You Get a Pool Loan With Bad Credit?

Having a bad credit score should not deter you from getting a swimming pool. You can apply and get approved for a swimming loan even when your credit score is low. One of the things you may need to do to get the swimming pool loan is to include a cosigner on your application form. You can ask a colleague, a friend, or a family member to be the cosigner on your swimming pool loan application. Your swimming pool loan may go through if that colleague has a high credit score.

Alternatively, you can wait for your credit score to improve. Similarly, you can borrow from non-traditional sources. Many of these non-traditional sources do not ask for your credit score.

A low credit score shouldn’t make you desperate to take anything that comes your way. You should carefully analyze each lender to determine the best one. Some lenders have the habit of setting high-interest rates for people with low credit scores. Consequently, it would help if you did enough research to find the most favorable lender.

What is the Average Interest Rate on a Pool Loan? How Much Does it Cost Every Month?

The average interest rates for swimming pool loans greatly vary. People with high credit scores and collateral can receive loans of about 5% per annum. However, if your credit score is low and you don’t have any collateral, you may run into interest rates of about 36%. Because the average cost of a pool is close to $40,000, the amount of money you are expected to pay per month can vary from $1,000 to $10,000.

How Long Are Pool Loans For?

Personal loans have flexible repayment periods ranging from two to ten years. Typically, the bigger the repayment period, the more interest you will pay. You can expect to repay your entire loan within eight to ten years with a home equity line of credit.  In some cases, this repayment period can extend to 20 years.

Will a Pool Increase My Home’s Value?

A few home improvement projects will increase the resale value of the house. Unfortunately, a new swimming pool at your home could have a negligible effect on the house’s overall resale value.

Moreover, using a loan to finance a swimming pool construction differs from using a loan to buy a car. That is because if you cannot repay a car loan, you can sell the vehicle and pay the debt. However, you can’t sell a swimming pool to repay your debtors.

How Do I Know I Can Afford a Pool?

Constructing a new swimming pool at your home is a huge financial undertaking, although the exact expenditure will vary from one swimming pool to another. The pool size, location, and additional features will increase the cost. Here are the average prices for constructing a new swimming pool.

Generally, the cost of building a swimming pool ranges from $20,000 to $60,000. Fiberglass pools are cheaper to make, while concrete and vinyl pools are more expensive to develop. Some people spend more than $100,000 on creating their dream pool.

You must also remember that the ultimate costs of constructing your swimming pool will be influenced by the interest rate you will pay on your loan. A relatively cheaper swimming pool can be expensive in the long term if you choose a loan with high-interest rates.

Some lenders provide interest rates of about 5% APR while some can provide loans with interest rates of almost 40%. Of course, the lender will look at things such as the type of loan, repayment period, and credit score.

Assume that you want $40,000 to construct a new swimming pool. Your lender tells you that the interest rate will be 10%, and you’re supposed to repay the entire loan within four years. This means that you will be paying about $1,015 every month. Therefore, the final cost of your pool will be $49,000.

Deciding to go for a loan with high-interest rates does not mean you will get that loan. Your lender will still evaluate your financial situation to determine whether you qualify for that particular loan. The main thing that lenders look at is your credit score history and current financial situation.

It is possible to find a lender offering swimming pool loans to people with bad credit, but that loan will have exorbitant interest rates. In such a situation, you will need to consider another factor: if your credit score is terrible, your new swimming loan can make it worse.

Perhaps you should consider delaying the application process until your credit score improves. While struggling to get a better credit score will delay your application process, it will reduce your interest rates in the future.

As stated above, saving money before applying for a swimming pool loan is a good idea. The idea is to make the eventual loan as affordable as possible. Consequently, you should borrow an amount that will only be used to construct the swimming pool. For instance, you can save money to cover 25% of the total cost of constructing the swimming pool. Moreover, saving enough money will reduce the repayment timeline.

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Bottom Line

There is no doubt that a swimming pool will be an excellent addition to any home. However, that alone should not be the rationale for seeking swimming pool financing. Instead, they are many things that you should take into consideration before choosing a swimming pool.

This article was done in partnership with a Certified Financial Advisor, and the information presented should not be taken as a recommendation for any one financing option. Always consider your current financial situation, long-term financial goals, and consult your own financial professionals if needed to make the best decision for your situation.

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