How to Finance a Swimming Pool

How to Finance a Swimming Pool article image.

Clark Griswold had high hopes for using his Christmas bonus check to build a pool, but you may want to take a different (more reliable) approach if a pool is in your future. Installing a pool can cost $50,000 or more on average, according to HomeAdvisor. Instead of paying this all at once, however, you can finance a new swimming pool with a plan tailored for your distinct budget and financial situation. Here, we'll show you the best strategies to finance a new pool, even if your bonus is a one-year membership to the Jelly of the Month Club.

What to Consider Before Getting a Pool

When you pick a pool design, you'll have to make a handful of decisions that'll have you consider your backyard aesthetic and what you can afford. You can choose to go classic with chlorine, or opt for a saltwater swimming pool. An above-ground pool is likely the cheapest option with a cost between $700 and $3,600, while a built-in style costs tens of thousands to construct. If you want a custom build, expect a six-digit price tag.

The design of your pool not only affects how much you'll need to fork over upfront to build it, but also how much you'll pay over time to keep it clean and swimmable (more on maintenance costs later). Gather estimates from several contractors to get a grasp on all the possibilities and their price points. Securing multiple quotes will help ensure you build your pool paradise at a price you can afford.

Five Ways to Finance a Pool

No matter what kind of pool you want, you don't need to fund it all at once to make your swimming pool dreams a reality. Let's take a look at the five best ways to finance a pool, each of which have their own pros and cons.

  1. Credit Card

    You may choose to charge your pool expenses on a credit card with a low annual percentage rate (APR) or, even better, find a card with a 0% APR intro offer. That way, you can spread out the bulk of your payments over months without incurring any interest. Plus, rewards credit cards can give you a return on your purchase in the form of points, travel miles or cash back. If you're applying for a new card, one with an introductory bonus for new cardholders can also help save you some money.

    What to watch out for: High interest rates can drive up the original price of your pool if you don't pay off the full amount before the end of your 0% APR period. Using a credit card for a major purchase is unwise if you don't have a plan to pay it off quickly. A high credit card balance can also cause your credit utilization to skyrocket—potentially affecting your credit scores.

  2. Personal Loan

    Possibly branded "pool loans," personal loans are offered by banks, credit unions and online lenders, sometimes even in collaboration with your pool company of choice. Like with a traditional credit card, you won't have to put your home or other property on the line for a personal loan. The borrowing process tends to be fast and simple compared with other financing options. Personal loan lenders include Upstart and OneMain Financial.

    What to watch out for: You may find a personal loan's interest rates aren't worth the convenience. Compare costs of home-secured loans (next on our list) to the costs of personal loans from different lenders.

  3. Home Equity Line of Credit (HELOC)

    A HELOC is secured by the value of your home. You can use a HELOC to pay for your pool and be charged a lower interest rate than you can get from many credit cards and personal loans—only paying interest on the money you withdraw. Also, the interest on your HELOC may be tax-deductible if you use it to upgrade your living space (for example, by adding a pool).

    What to watch out for: Unlike credit cards, HELOCs put your house on the line, which means it can be repossessed by the lender if you fail to repay your debt. Additionally, HELOCs typically have variable interest rates, so your monthly payments may vary. When the 10-year draw period on your HELOC ends, you could face high monthly payments on the remaining balance if you haven't already paid off your pool.

  4. Home Equity Loan

    As with a HELOC, a home equity loan lets you borrow against the value of your home. Instead of a line of credit, however, a home equity loan offers a lump sum of cash you can use to pay for your pool, usually with a fixed interest rate.

    What to watch out for: Taking out a home equity loan has potentially steep closing costs and also uses your home as collateral.

  5. Cash-Out Mortgage Refinancing

    Depending on the amount of equity you have in your home, you may be able to get cash when you replace your current mortgage loan with a new one. When you refinance, you can secure lower interest rates on your new mortgage and cash out up to 80% of your home equity.

    What to watch out for: As with a home equity loan, refinancing means going through the whole mortgage borrowing process all over again—forms, closing costs and all. You'll also most likely stretch out the timeline to pay off your mortgage, which could result in paying significantly more in interest.

Before you dive into any applications, check your credit score. A shining credit score could help you secure more favorable interest rates on your credit cards and loans. If your credit isn't perfect, take a few steps to clean it up.

How Much Does It Cost to Maintain a Pool?

Once you sort out your financing options, consider the cost of pool upkeep. This can vary depending on a few factors, but maintenance costs are unavoidable unless you want a nasty, green pool. Here are some of the ongoing costs you take on with a pool:

  • Maintenance: Pools require regular care, including seasonal "openings" and "closings" depending on where you live. You can probably cover some pool basics yourself, like checking water chemistry or emptying skimmers, but other jobs require a pro—that is, unless you can expertly disassemble and reassemble a pool heater (please don't try).
  • Materials: Your pool's construction will factor into how much you'll spend on upkeep over the years. For example, you can opt for vinyl lining to cut upfront costs, but it may require more attention than a fiberglass liner. On the other hand, replastering a concrete pool totals around $10,000, whereas a replacement for a vinyl-lined pool costs under $5,000.
  • Utilities: Unsurprisingly, pools require a sizable amount of water. Filling and maintaining tens of thousands of gallons of water adds up on your water bill. As far as electricity, running your pool heater or pump can add an average annual $300 to your energy bill.
  • Repairs: Inevitably, whether it be a tear in the lining or a hopelessly backed-up filter, your pool will eventually need some extra TLC. Repairs can cost anywhere from a few hundred dollars to several thousand.

HomeAdvisor estimates pool owners shell out between $3,000 and $5,000 every year to keep their pools clean and operational, so take a close look at how much your desired pool will cost over time.

Ready to Dive In?

Now that you know the ins and outs of pool financing, you can select the best options for your home and budget. Consider both short- and long-term costs attached to your backyard oasis before setting your plan in stone—you'll feel much more relaxed sitting poolside knowing how well you financed it.

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