The Best Loan Options for Your Home Improvements

Your home is one of the most significant investments you’ll make in your lifetime. Upgrades and renovations are a fantastic way to boost your quality of living and add value to your property. But what is the best home improvement loan?

There is no one-size-fits-all answer to this question. Let’s examine a few of your best options.

Option 1: Take out a personal loan

For most small- to medium-sized home improvement projects, taking out a personal loan is a top option to consider. This is especially true if the upgrades you are making are solely cosmetic.

Here are a few reasons personal loans are one of the best loans for home improvements:

  • Personal loans are cheap, fast, and easy. Closing costs for personal loans are usually quite low. The application process is quick – in some cases, you can expect to be approved on the same day as you lodge your application.
  • Personal loans are paid back fast. If you decide to refinance your property (more on that below) to fund home improvements, you’ll most likely be paying for those improvements for the next 15 to 30 years. Stretching out repayments will lead to a higher lifetime interest cost.

Do keep in mind, however, that personal loans typically come with higher interest rates than home loans. Personal loans’ lifetime interest cost will probably be less despite the higher rate.

Option 2: Refinance your home loan

If the interest rate on your home loan is higher than current rates, you may benefit from refinancing. This could lower your monthly repayments, all the while freeing up cash for your home improvement project.

You might also consider a cash-out refinance. Some lenders will allow you to borrow up to 80 per cent of your home’s value – that means cold, hard cash that you can use to renovate your property.

If you do decide to take this route of financing, do keep in mind that you are putting your home up as collateral for a bigger loan than you already have. You’ll be paying for costs with a long-term loan, adding the expenses of interest and other fees to the overall cost of your renovations.

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Option 3: Use a credit card

If you don’t have the cash up-front, you could use a credit card to make home improvements. Just be 100 percent sure you can pay off your balance within a short period of time – credit cards usually boast interest rates higher than any other type of financing.

Option 4: Save up and pay with cash

Patience is a virtue, right? If you are in a position to put away a portion of your income each week, and the improvements you plan to make are not urgent, saving up could be the best option.

Find out more about home improvement financing

Decided that personal loans are one of the best loan options for your upcoming home improvements? Find out more about our personal loans, or apply online right now.

Disclaimer: Please be aware that Cigno Loans’ articles do not replace advice from an accountant or financial advisor. All information provided is intended to be used as a guide only, as it does not take into account your personal financial situation or needs. If you require assistance, it is recommended that you consult a licensed financial or tax advisor.


Ordered by the Federal Court of Australia

The Federal Court of Australia has found that Cigno Australia Pty Ltd (Cigno Australia) and BSF Solutions Pty Ltd (BSF Solutions) have breached the law by engaging in unlicensed credit activity and charging prohibited fees.

In the period from July 2022 to 3 October 2023, over 100,000 consumers have been lent a total of $34 million, and charged fees of over $70 million, under the ‘No Upfront Charge Loan Model’ operated by BSF Solutions and Cigno Australia. At no time has either BSF Solutions or Cigno Australia held an Australian Credit Licence.

The Court also found that Mark Swanepoel (director of Cigno Australia) and Brenton James Harrison (director of BSF Solutions) were involved in these breaches of the law.

With effect from 24 May 2024, the Court has granted permanent injunctions preventing Cigno Australia and BSF Solutions from:

  • demanding, receiving or accepting fees or charges, including amounts of loan principal, from consumers in relation to credit provided under the ‘No Upfront Charge Model’; and
  • engaging in further credit activity pursuant to the ‘No Upfront Charge Loan Model’, including by entering into new agreements with consumers, for so long as they do not hold an Australian Credit Licence.

Cigno Australia was ordered by the Court to, by 5th July 2024, send written communications to consumers who between July 2022 and December 2022 entered into agreements with Cigno Australia and BSF Solutions under the ‘No Upfront Charge Loan Model’.

The Court will later determine whether (among other things) Cigno Australia and Mark Swanepoel ought to pay a pecuniary penalty in respect of this conduct, and whether Mark Swanepoel should be restrained from carrying on a business engaging in credit activity.

Cigno Australia, BSF Solutions, Mr Swanepoel and Mr Harrison intend to appeal the decision of the Court and have filed an application for leave to appeal. If the appeal is successful, some or all of the orders of the Federal Court of Australia may be set aside.

Where can you get more information?

Where to go for further support

You can access legal advice in your state at: Free legal advice –

If you are experiencing trouble with debt, or money worries in general, contact:

  • the National Debt Helpline on 1800 007 007 or online chat (9:30am to 4.30pm, Monday to Friday).

If you need someone to talk to, contact:

  • Lifeline on 13 11 14 (24 hours) or their crisis support online chat or
  • Beyond Blue on 1300 22 46 36 (24 hours) or their webchat