The following is a guest post from Robert McMillen. Robert is an entrepreneur, finance professional, consultant, and passionate writer. For many years using his industry knowledge and experience he has helped his clients to create more wealth and reduce costs.

Whether it’s been decades or just a few months since you’ve lived in your home, sometimes it requires a little extra love, often in the form of upgrades. However, the funds for home upgrades — from minor repairs to major renovations — aren’t always readily available in your bank account or budget.

Your financial condition and the scope of the project will determine how you pay for your home renovation. The best method to pay for a home renovation is to save up for a specific project and then use that money. This isn’t always doable, though. Financing may be required for unexpected expenditures or bigger improvements.

You’ll need to consider your monthly budget as well as the size and return on investment of your project when deciding if home renovation financing is right for you. Is it possible for you to make another monthly payment? Is the renovation you’re considering going to add value to your home? How long will it take to complete this renovation? If you’ve determined that financing your home renovation is the way to go, and if your cash flow is tight, fortunately, you have a few alternatives for financing home improvements. Here are some alternatives to pay for house improvements:

1. Home improvement loan

Home improvement loans are unsecured personal loans that are available through banks, credit unions, and a variety of online lenders. You do not need to use your home as collateral to qualify for the loans because they are unsecured. Your interest rate and qualification are heavily influenced by your credit score. Many lenders transfer money directly into your account in as little as a day after you agree to the conditions.

However, because they are unsecured, home renovation loans typically have higher interest rates than home equity loans and HELOCs, particularly if you have fair or poor credit. Before applying, evaluate the top home improvement loan providers who offer cheap interest rates, competitive fees, and flexible repayment periods.

2. Home equity line of credit (HELOC)

A home equity line of credit, also known as a HELOC, is a revolving credit line secured by your home that you can use to pay for major expenses or consolidate higher-interest debt from other lenders, such as credit cards. The interest on a HELOC is frequently lower than on other forms of loans, and the interest may be tax-deductible.

You borrow against the available equity in your home with a HELOC, and your home serves as collateral. The quantity of available credit is refilled when you repay your outstanding debt – similar to a credit card. This means you may borrow against it again if necessary, and you can borrow as little or as much as you need during the course of your draw period, up to the credit limit you set at closing. The payback period begins once the draw period has ended.

A HELOC may be a suitable home improvement choice for ongoing or long-term remodeling projects. It is also a fantastic choice for home repairs because it provides rapid access to money.

However, your home might be foreclosed if you don’t make payments on time since you must place your house in a collateral position. Most HELOCs also have variable rates, which allow you to adjust your payments according to market conditions.

3. Home equity loan

A home equity loan is a form of consumer debt that is also known as a home equity installment loan or second mortgage. Home equity loans enable homeowners to borrow money against the value of their property. The loan amount is determined by the difference between the current market value of the house and the outstanding debt on the homeowner’s mortgage. Fixed-rate home equity loans are more common than variable-rate home equity lines of credit (HELOCs).

You don’t have to worry about market fluctuations with home equity loans; once you lock in your fixed interest rate, you’ll pay the same monthly payment for the duration of your loan. The drawback is that you don’t have as much payment flexibility as you would with a HELOC.

If you know precisely how much your project will cost, a home equity loan may be the best option for you because you’ll get all of the money upfronts. Missed payments, on the other hand, might be quite costly. Because this sort of loan also utilizes your property as collateral, if you fall behind on payments, your home may be repossessed.

4. Personal loan

You can use any kind of personal loan to improve and renovate your house. Personal loans have higher interest rates than HELOCs and home equity loans. However, if you want to use those financing alternatives, you’ll have to put your house up as collateral. You’ll also need adequate equity in your house, which is the gap between the amount you owe on your mortgage and the value of your property. The amount you may borrow is determined by the size of your equity.

You won’t need equity to get a home repair loan, and you won’t have to worry about losing your house. However, if you fail on your loan, you may expect a significant reduction in your credit score, as well as a default notice that might linger on your credit record for up to seven years.

If you have a strong credit history, qualifying for a secured or unsecured personal loan is generally easier than applying for other forms of financing. In that instance, proving income and work may be all that is required. Even if you have bad credit, a personal loan may be an option.

5. Cash-out refinance

Cash-out refinancing is when your current mortgage is replaced with a new, bigger loan with a new interest rate. You might utilize the additional cash from a cash-out refinance to make home renovations since you get to keep the difference between your previous and new mortgage.

If you’re considering refinancing, think about the disadvantages first. An appraisal, origination fees, taxes, and other closing-related charges must all be paid. You’ll be prolonging the life of your debt unless you refinance it for a shorter period, which means it’ll take you longer to pay it off. In general, refinancing is a smart option only if you can get a lower interest rate than you are currently paying.

6. Credit cards

Using your credit card to make modest home improvements, such as replacing a bathroom vanity or installing a new closet system, might be one of the finest home improvement financing alternatives. What is the benefit? For the first several months, certain credit cards are interest-free. You might pay for small home renovations with a 0% introductory APR credit card and never pay interest. If your credit card provides cash back incentives, the more you spend on a renovation, the more cash back you might receive.

Using a credit card to make major home repair expenses comes with certain dangers. If you are unable to repay your amount before the promotional offer ends, you may be subjected to extremely high-interest rates, which are far greater than those offered by other home improvement loan alternatives. If you use your normal card instead of an introductory offer card, you’ll have to pay the whole balance back before the end of your next billing cycle, which is generally a month, to avoid interest. Because variable interest rates fluctuate with market conditions, the amount you pay in interest may also rise.

7. Government loans, grants, and special programs

You can save money on interest and insurance if you qualify for a government loan. You may borrow up to $25,000 from the government without having any equity in your house. If you’ve recently acquired a house and need to make improvements, this is a fantastic home repair loan choice. However, the funds must be used for modifications that improve the home’s livability, and certain changes may not be eligible.

One of the most significant issues when doing a home renovation project is the cost of doing it. Fortunately, you may be eligible for a grant to help you with the costs. Hundreds of government-sponsored home renovation grants and special programs are available to homeowners who make certain improvements to their homes. Of course, not everyone—and certainly not every project—will be eligible for grant money. Many grants are targeted for particular renovations that guarantee the house is safe, accessible, habitable, and non-hazardous to individuals on the premises and in the community. Before applying any sort of financial alternatives for home improvement, try to get a grant, it will help you to save a lot.

You have numerous financing choices to enhance your house, whether you’ve been planning to add an in-ground pool for years or you’re suddenly faced with a roof repair that needs to be done right away. With so many choices, you’ll be able to select one that works best for you based on financial considerations (such as your home’s equity and credit score) as well as personal preferences (such as how and when you’ll repay your loan). You can make your house HGTV-worthy by giving it the TLC it needs, whether it’s through refinancing, personal loans, or plain cash.