Home improvement loans are personal loans used to cover the cost of home repairs, renovations, or even redecorations. The funds are issued in one lump sum, which is then repaid via monthly installment payments with a fixed interest rate. Home Improvement loans are unsecured which means you don’t have to put up collateral to get the loan.

Yes, a personal home improvement loan can be used to finance home additions such as adding a sunroom, deck, guest bathroom and more.

PNC Personal Loans used for home improvements are not tax deductible.

Consult a tax advisor regarding potential or available tax benefits when researching loan options.

Home improvement loans and HELOCs can both provide access to funds needed to improve your home, but there are several differences between these two options, including:

• How funds are received. Home improvement loans are accessed in one lump sum, while HELOCs are revolving lines of credit that can be borrowed against as needed.
• How funds are repaid. Repayment of home improvement loans begins immediately, while HELOCs may offer a “draw period” when, at your option, the payments either consist of interest only or principal and interest.
• Whether collateral is needed. Home improvement loans do not require collateral. HELOCs use the home as collateral to secure the loan.
• Interest rates. HELOCs may offer lower interest rates than home improvement loans. Home improvement loans typically have a fixed interest rate, meaning the rate will not change during the loan term. HELOCs typically come with a variable interest rate, meaning the rate fluctuates with changing market conditions.
• Tax implications. Interest on home improvement loans is generally not tax deductible. Interest on HELOCs may be tax deductible when used for substantial home renovations. Consult with a certified tax accountant before making a decision based on potential tax savings.

For more information about HELOCs, visit What is a Home Equity Line of Credit?