How to Finance a Swimming Pool

A swimming pool is a large investment, especially an inground pool. Fortunately, there are several options on how to finance a swimming pool. But first, you will need to understand the basics of pool ownership and lending opportunities.

How Much Pool Can You Afford?

In order to explore financing options, you will need to determine how much pool you can actually afford. Pool costs are much more than just installation. You need to consider landscaping, ongoing maintenance, increased utility costs, insurance premiums, and more. The average inground pool costs between $25,000-50,000 to build. Consider this your base price. Beyond that, as the size of the pool increases, so does the price (roughly $50 per square foot). Depending on where you live, the price of the building permits and the pool itself will vary. In addition to these costs, you will need to consider landscaping, fencing (which is usually required), and any extra pool features you may want. As you can imagine, it is very easy see an invoice as big as $100,000 for a luxury pool.

2nd Mortgages and Equity Line Financing

One of the most popular financing options for a swimming pool is taking out a second mortgage or line of equity. However, this option won’t work for everyone. It takes awhile for substantial equity to be established in a home, so homeowners who have not owned their home for at least 6 years will have trouble qualifying. If you are considering using a line of equity, establish the amount for which you’re qualified before hiring a pool contractor.

Unsecured Loans

For homeowners who have not yet established enough equity in their home, there are a myriad of unsecured loans available. Unsecured loans are only offered to homeowners with excellent credit who are willing to pay higher loans rates than a 2nd mortgage might offer. Rates for unsecured loans vary, but are usually around 14-18%. Additionally, unsecured loans have caps, and most lenders will not loan more than $30,000, which means that homeowners may need to come up with additional funds.

In-House Financing

In-house funding is essentially the same thing as an unsecured loan, except it is channeled through the pool company. Like car dealerships, the pool company works with third party lenders to offer you financing options. Check with you pool builder to see if they offer in-house financing, as they may offer additional incentives if you finance through their company.

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