Updated 10/15/2026
The most common ways to finance a home remodel are contractor financing, a home equity loan, a home equity line of credit (HELOC), a cash-out refinance, a personal loan, and, if you’re buying a home that needs work, an FHA 203(k) loan. Contractor financing and personal loans are the fastest and don’t use your house as collateral. Home equity options usually cost less over time but take longer, and in Texas they follow special rules set by the state constitution.
Master Remodelers is a family-owned remodeling company that has served Houston, Pearland, Friendswood, League City, Clear Lake and Galveston since 1998. We offer home improvement financing through Slice by FNBO, and we help homeowners compare their options every week. Here’s how each one works.
Table of Contents
Remodel Financing Options at a Glance
Option | Uses your home as collateral? | Speed | Best for |
|---|---|---|---|
Contractor financing | No | Fast, often same day | Windows, siding, baths and mid-size projects |
Home equity loan | Yes | Slower (Texas requires at least 12 days to close) | Large projects with a fixed price |
HELOC | Yes | Slower (same Texas rules) | Projects paid in stages, like additions |
Cash-out refinance | Yes | Slowest | Large projects when refinancing makes sense anyway |
Personal loan | No | Fast | Smaller projects, or homeowners with little equity |
FHA 203(k) loan | Yes (it’s your mortgage) | Slow | Buying or refinancing a home that needs repairs |
1. Contractor Financing
Many remodelers, including Master Remodelers, work with a lender so you can apply for financing as part of your project. At Master Remodelers, financing is provided by First National Bank of Omaha (FNBO) through Slice, not by Master Remodelers. You apply online, Slice makes the credit decision, and you see your plan’s rate, term and monthly payment before you accept.
- Pros: quick application, no home appraisal, and your house isn’t collateral. Plans include 0% promotional options for qualified buyers.
- Cons: rates after any promotion can be higher than home equity rates, and loan amounts may be lower.
- Good for: window replacement, siding, bathroom remodels, outdoor kitchens and other projects you want to start soon.
See current plans and apply on our financing page.
2. Home Equity Loan
A home equity loan gives you a lump sum, borrowed against the value of your home, with a fixed rate and a fixed monthly payment.
- Pros: usually lower rates than unsecured loans, and a predictable payment.
- Cons: your home is collateral, closing takes longer, and there may be closing costs.
- Good for: a large project with a firm price, such as a kitchen remodel or whole-home renovation.
3. Home Equity Line of Credit (HELOC)
A HELOC works like a credit line secured by your home. You draw money as you need it and pay interest only on what you’ve used. Rates are often variable.
- Pros: flexible, which suits projects paid in stages.
- Cons: your home is collateral, and a variable rate means your payment can change.
- Good for: room additions and multi-phase remodels.
Texas Home Equity Rules to Know
Texas has stricter home equity rules than most states. They’re written into the Texas Constitution (Article XVI, Section 50(a)(6)) and apply to home equity loans, HELOCs and most cash-out refinances on your homestead. Key points from the state’s required home equity consumer notice:
- 80% limit: your new loan plus all other loans on the home can’t be more than 80% of its fair market value.
- 12-day wait: the loan can’t close until at least 12 days after you apply or receive the state notice, whichever is later.
- One at a time: only one of these loans can be on your home at once, and you generally can’t take out a new one within a year of the last.
- 3-day right to cancel: you can cancel within 3 days after closing without penalty.
Ask your lender for the current Texas home equity disclosure before you apply. Because of the 12-day wait, start the application early if you want to keep your remodel on schedule.
4. Cash-Out Refinance
A cash-out refinance replaces your current mortgage with a larger one and gives you the difference in cash.
- Pros: one monthly payment, and often a lower rate than other options.
- Cons: it resets your mortgage and has closing costs. If your current mortgage rate is lower than today’s rates, this can cost more than it saves.
- Good for: large projects when refinancing already makes sense for you.
5. Personal Loan
A personal loan is an unsecured loan from a bank, credit union or online lender, with a fixed rate and term.
- Pros: fast funding, no appraisal, and your home isn’t collateral.
- Cons: rates are usually higher than home equity loans, and amounts may be smaller.
- Good for: smaller projects, or homeowners who haven’t built much equity yet.
6. FHA 203(k) Renovation Loan
An FHA 203(k) loan lets you roll the cost of repairs and improvements into the mortgage when you buy or refinance a home. The Limited 203(k) covers smaller, non-structural projects; HUD raised its limit to $75,000 in 2024 and reviews it each year. The Standard 203(k) covers larger and structural work.
- Pros: one loan for the home and the remodel.
- Cons: more paperwork, an FHA-approved lender, and rules on how contractors are paid.
- Good for: buying a fixer-upper.
What About Cash and Credit Cards?
Paying from savings costs nothing in interest, but keep an emergency fund. Credit cards work for small purchases, such as fixtures, but standard card rates make them a costly way to pay for a whole remodel unless you can pay the balance off quickly.
Choosing the Right Option for Your Project
- Small or mid-size project you want to start soon: contractor financing or a personal loan.
- Large kitchen, whole-home remodel or addition, with good equity: home equity loan, HELOC or cash-out refinance.
- Buying a home that needs work: FHA 203(k).
- Not much equity yet: contractor financing or a personal loan.
6 Tips Before You Borrow
- Get a written estimate first. You’ll know exactly how much to borrow. Start with a free remodel estimate.
- Compare the APR, not just the monthly payment. A lower payment over a longer term can cost more in total.
- Read promotional terms closely. Some “0%” plans waive interest; others defer it, which means interest can be charged back to the start if the balance isn’t paid in full by the end of the promotion.
- Plan a cushion for surprises, especially in older homes, where hidden rot or wiring issues can turn up once walls are opened.
- Don’t borrow more than the project needs.
- Be wary of any contractor who wants most of the money up front in cash. A reputable contractor gives you a written contract and a clear payment schedule.
Why Homeowners Choose Master Remodelers
- Family owned and operated since 1998, led by President Donald “Don” Borden.
- Rated A+ by the BBB, and winner of the Pulse of the City Award in 2025 and 2026.
- Financing through Slice by FNBO, with plans for a range of credit profiles, subject to credit approval.
- Free, written estimates for kitchens, baths, additions, windows, siding, outdoor living and whole-home remodels.
- Licensed and insured.
Frequently Asked Questions
It depends on the size of the project and how much equity you have. Contractor financing and personal loans are fastest and don’t use your home as collateral. Home equity loans, HELOCs and cash-out refinances usually have lower rates for large projects but take longer to close, and in Texas they must follow state home equity rules.
Yes. Master Remodelers offers home improvement financing through Slice by FNBO. Financing is provided by First National Bank of Omaha (FNBO) through Slice, not by Master Remodelers. You apply online, and Slice shows you the rate, term and monthly payment before you accept.
Yes. Texas allows home equity loans and HELOCs on your homestead, but the total of all loans on the home can’t exceed 80% of its fair market value, the loan can’t close until at least 12 days after you apply, and you can cancel within 3 days after closing.
A home equity loan pays you a lump sum with a fixed rate and payment. A HELOC is a line of credit you draw from as needed, and you pay interest only on what you use, usually at a variable rate. A HELOC suits projects paid in stages; a home equity loan suits projects with a firm price.
It can be, but read the terms. Some 0% plans waive interest during the promotional period, while others defer it, which means interest can be charged back to the start if the balance isn’t paid in full by the end of the promotion. The lender must show you the full terms, including the APR, before you accept.
Ready to Plan Your Remodel?
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