We use cookies to provide you with the best possible online experience. Read more

How to pay for your home renovation

Remodelling your home is the time to bring that dream kitchen, bathroom or extension to life.

Property Home loan application checklist A handy checklist to what you’ll need before applying.
Money Discover more joy in your budget If you have finished decluttering your house, consider organising your bills!
Property How Molly and Michael bought their first home Buying their home was easy with Australia’s Home Lender of the Year for 2018.

Remodelling your home is the time to bring that dream kitchen, bathroom or extension to life. However the most asked question during this time is: how am I going to pay for it? 

Here are the top 5 ways you could consider to pay for your dream renovation:


If you have savings this can be the simplest and cheapest way to fund a renovation. Savings are easily and quickly accessed and don’t incur any interest charges (unlike a loan). Another advantage of using your savings is that it ensures you stay within budget, because once the money is spent there is no more! 

Use equity in your home

If you have paid off a large amount of your home, or it has significantly increased in value you could leverage your equity to pay for your home reno. Accessing equity involves talking to your bank to refinance your home loan. By extending your home loan term, your interest rate will, in the majority of cases, be lower than taking out a personal loan. 

The trade-off of refinancing is that you may incur fees and ultimately you are increasing your loan balance and potentially the number of years that it will take to pay off your home loan. 


If you are in advance on your home loan and your loan offers redraws, you could access these funds to put towards your renovation. Redrawing is essentially withdrawing the extra repayments you have made on your home loan, so it can be relatively easy and quick to get access to the funds. You should be aware that you can only redraw up to the amount of additional payments you’ve made and some lenders may charge a fee to use the redraw facility.

Credit card

Generally credit cards are an easy way to access funds for a renovation. However, a credit card is only suitable if you are able to pay off the balance within a period that minimises your interest costs, so it’s best to stick to smaller amounts that are within your means. Be careful of overloading your credit card with too much debt because the interest charges can quickly add up. 

If you do find yourself using your credit card to pay for a small renovation, be sure to seek out a low rate credit card to ensure you are limiting the interest costs. 

Personal loan

Personal loans are another alternative for making your dream renovation a reality. Personal loans generally have a shorter repayment period and a higher interest rate (when compared to refinancing a home loan), and may incur fees. There can also be restrictions on the type of renovations you can complete using a personal loan. Your local lender can help you with the right personal loan for your renovation.

This article is intended to provide general information of an educational nature only. It does not have regard to your objectives, financial situation or needs and must not be relied upon as financial product advice. Before you act on this information, you should consider whether it is appropriate for your circumstances. Information in this article is current as at the date of publication. Applications subject to credit approval and fees and charges are payable. Terms and conditions apply and are available on request.

Business banking

Our team of Hunter based business banking experts are here to help.

Find out how

Send this article to friends and family

Property Managing your new home loan All the things you need to know for settlement.
Money Audit your subscriptions How the decluttering trend can save money in your budget.