The Bottom Line

Although it can enhance your backyard, installing a swimming pool can be expensive. When it comes to financing options, SoFi is our overall best lending option based on its rates, loan amounts, and repayment terms. Lyon Financial may be a good alternative if you want a larger loan (up to $200,000) and terms as long as 30 years. Upgrade makes our list if you have fair to good credit. It has a lower credit score requirement than most lenders and offers secured loans and joint applicants.

Guide to Choosing the Best Pool Loan

What Are Pool Loans and How Do They Work?

A pool loan is a type of unsecured personal loan that you can use to finance the purchase and installation of a new above-ground or inground pool. It is an installment loan, so you repay it in monthly installments over a specific period, and it has fixed interest rates. 

How Much Does a Swimming Pool Cost?

The cost of a new swimming pool varies by location, size, and pool type. Your cost may also vary based on the material used and the style. Keep in mind that your municipality may require you to get permits to install a pool, which your contractor can look after. The table below highlights the national average and average range of building an inground and above-ground swimming pool.

Average Cost of Building a Swimming Pool
	National Average	Average Range
Inground	$60,350	$41,750 to $80,000
Above-Ground	$3,350	$700 to $5,000

The cost, of course, does not include the ongoing expenses of keeping a pool. These include things like supplies and equipment, decking, and fencing among others. And don't forget, since your new can boost your property value, your property taxes may increase, too.

Where to Get a Pool Loan

Pool loans can come from several sources.

• Banks: Traditional banks may offer financing options, including unsecured pool loans and home equity loans. 
• Credit unions: Credit unions are non-profits, so they may be able to offer you lower rates than banks. 
• Online lenders: Online lenders boast easy applications and quick loan processing times.

Should You Apply for a Pool Loan?

Unsecured swimming pool loans can help you achieve the backyard oasis you imagine without risking your home or going through a lengthy application process. You can apply online quickly and, if approved, receive your money as soon as the same day. 

However, taking out a loan for an unnecessary project may not be the best idea. Interest rates can be in the double digits, and many people will end up paying thousands in added interest charges.

When deciding whether a pool loan is a good idea, consider the following: 

• Climate: Whether a pool and a pool loan make sense is largely dependent on where you live. For example, if you live in a sunny state like Florida, your pool could be open year-round, giving you more time to enjoy it. By contrast, a pool may be unusable for eight or nine months of the year in northern states. 
• Duration: How long you intend to stay in your current home will help inform your decision. If you plan on staying in your home for years or even decades, a pool loan could be a good choice. But if you plan to move within the next few years, you may want to hold off; just 1% of realtors recommended installing a pool before selling a home. 
• Return on investment: A pool is a significant investment, and you may be surprised by how little it affects your home value. According to the National Association of Realtors, homeowners recovered just 56% of the cost of an in-ground pool installation.
• Other costs: Besides the cost of purchasing and installing the pool, consider your ongoing maintenance costs. Pumps, filtration systems, heating bills, and chemicals can add up, costing you thousands each year.

According to Investopedia’s 2023 Personal Loan Borrower survey, a home improvement project, such as adding a pool, is the second most common reason for getting a personal loan. Consolidating debt is the most common reason.

Alternatives to a Pool Loan

Besides unsecured pool loans, you can use these alternatives to pay for a new pool.

• Savings: If possible, put off your pool installation until you save enough money to cover it in cash. It may take more time, but you'll save money in interest. 
• Home equity loan: A home equity loan, also known as a second mortgage, allows you to borrow against the equity you’ve built in your home. The loan amount is based on the difference between your home’s current value and what you owe on your existing mortgage.
• Home equity line of credit (HELOC): Like home equity loans, HELOCs enable you to tap into your home’s equity to finance your swimming pool installation. But rather than getting your money in a lump sum, HELOCs are a revolving line of credit, so you can use the line of credit again and again during the draw period.
• Cash-out refinance: With a cash-out refinance loan, you replace your existing mortgage with a new one with a larger amount than you owe, getting the difference in a lump sum.

Comparing Pool Loans

Many lenders offer swimming pool loans. To find the best pool loans, consider the following factors: 

• APR: You’ll find a wide range of rates for unsecured pool loans; our top providers offer APRs from 6.99% to 35.99%. The APR (which includes the interest rate and certain fees) is the single biggest factor affecting your total repayment cost, so shop around and compare offers to get the best rate. 
• Available discounts: Some lenders offer special discounts for borrowers who are existing customers or that sign up for automatic payments. Taking advantage of those offers can help you save time and money. 
• Co-applicants: If you don’t meet the lender’s requirements on your own, some lenders allow you to apply with a relative or friend to improve your odds of getting a loan. 
• Fees: Some personal loan lenders charge high origination fees, application fees, and late fees, affecting your overall cost. Look for lenders that offer low or no fees. For example, neither LightStream nor SoFi charges origination fees. 
• Repayment terms: Unsecured pool loans tend to have repayment terms between two and 12 years. However, some specialty lenders like Lyon Financial offer terms as long as 30 years, which could give you a much lower payment. 

How to Qualify for and Apply for a Pool Loan

To qualify for a pool loan, you generally need to meet some eligibility requirements. The following are a few of the most common things that lenders consider from potential borrowers:

• Your age: Lenders cannot discriminate based on age. However, some states require that borrowers meet minimum age requirements before they can enter a legal financial contract with a financial lender.
• Legal residency: Just like age, lenders can't turn you down because of your national origin. They may ask you about your residency status to determine whether you can pay back the loan. Keep in mind that non-residents and non-citizens may still qualify, but it may be tougher to be approved.
• Income: Almost all lenders ask you for your income and employment information. This is to ensure that your source of income is enough to repay the loan. Some companies may have an income threshold before you can borrow.
• Debt-to-income (DTI) ratio: This ratio represents how much of your income goes to pay off your debts every month. As such, it helps lenders see how much of a risk you are if they approve you for a loan.
• Credit history and score: The majority of lenders use your credit history and credit score to qualify you for a loan. Although these factors don't make or break the decision, they may also influence your loan terms, amount, and interest rate.

The application process for a pool loan is simple.

• Pre-qualify for a loan: Shopping around is critical to find the best rates and terms. Many lenders have pre-qualification tools you can use to get loan estimates without affecting your credit. Once you’re ready to move forward with the application, you can apply online through the lender’s website. 
• Fill out the application: Lenders will ask for personal information, including your Social Security number and employer. You’ll have to consent to a hard credit check and may have to submit verification of your identity, such as a copy of your driver’s license. Depending on the lender, you could receive a decision on your application within minutes, or the lender may take a few days. 
• Review the loan agreement: Once approved, the lender will send you a finalized loan agreement that outlines the loan’s APR, repayment term, and total repayment cost. If you agree to the terms, sign the agreement and return it to the lender. The lender will disburse the funds, usually by depositing them directly into your bank account. Going forward, you can manage your account and make payments through the lender’s website or mobile app.

Why You Should Trust Us

Investopedia collected and analyzed hundreds of key data points from over 70 companies across three months to identify the most important factors for readers choosing a fair loan lending company. We used this data to review each company for fees, repayment terms, income requirements, and other features to provide unbiased, comprehensive reviews to ensure our readers make the right decision for their needs. Investopedia launched in 1999 and has been helping readers find the best loans for those with fair credit since 2020.

How We Pick the Best Pool Loans

To evaluate and rank personal loan providers we collected hundreds of data points across more than 70 lenders, including traditional banks, credit unions, fintechs, and special interest finance companies. We researched and evaluated APRs, loan amounts and terms, fees, customer experience, and much more.

To rank the lenders in our database and to generate star ratings, we weighted the data we collected, based in part on what consumers told us were the most important features of a personal loan and lender in a survey we conducted. We grouped those factors into four broad areas:

• Loan costs (advertised APR, fees, and six other factors): 29.25%
• Loan terms (loan amount, repayment term, and three other factors): 22.25%
• Borrowing requirements (credit score, membership requirement, and six other factors): 28.5%
• Additional features (online application, pre-qualification, and eight other factors): 20%

Learn more about how we evaluated personal loans in our complete methodology.

Guide to Personal Loans

Learn more about personal loans:

• What is a personal loan?
• How do personal loans work?
• When are personal loans a good idea?
• How to get a personal loan
• How to apply for a personal loan
• How to use a personal loan
• Where to get a personal loan
• Personal loans vs credit cards
• Alternatives to personal loans
• Personal loan calculator
• Personal loans methodology