Offer finance for home improvements

Why finance matters for UK renovations right now

UK homeowners are planning a busy few years of upgrades. Almost seven million say they intend to renovate, with typical project budgets around £14,000 and marked regional differences in what gets done. Kitchens and bathrooms remain popular, while Londoners are more likely to extend. That activity sits within a market worth roughly £11 billion in 2024 and projected to climb towards £16.6 billion by the early 2030s. In short, there is sustained demand - and a clear opportunity to offer finance that makes projects achievable.

Most households still lean on savings. Recent UK data shows around 83% of renovators primarily fund work from cash, while credit card use is declining. Homeowners are selective with borrowing after a period of rate volatility, and they respond best to transparent, predictable payment plans. Fixed-rate personal loans, low-cost instalments and specialist green finance are more attractive than revolving credit.

Energy performance is a decisive driver. A majority of homeowners have either completed or plan to complete efficiency upgrades, and younger owners particularly prioritise insulation, heating and renewable systems. Finance that rewards greener choices - for example, preferential rates or cashback linked to energy measures - can unlock projects and improve long-term affordability.

Most major works are delivered by professionals rather than DIY, so point-of-sale finance via trusted trades, merchants and portals is pivotal. Embedding finance into quotes helps homeowners compare monthly payments with confidence.

Clarity converts: show the APR, the monthly figure, and the total payable upfront.

Who benefits from offering finance

If you are a contractor, merchant or service platform, finance can accelerate decisions and increase average order values without pushing customers beyond their comfort zone. Typical mid-value projects - £5,000 to £25,000 for kitchens, bathrooms or heating - suit unsecured loans or instalments. Larger works - £25,000 to £150,000 for extensions, loft conversions or deep retrofits - often align with secured lending or specialist green products.

Homeowners benefit from fixed monthly payments that fit household budgets, especially when savings cover part of the cost. Younger owners value quick digital journeys and fast decisions, while older owners often prefer clear documentation and human support. In every case, the proposition should be simple, fair and free of surprises.

Ways to fund the work

1. Fixed-rate personal loan - predictable payments over 1 to 7 years.

2. 0% or low-rate instalment plan - promotional terms with participating trades.

3. Secured homeowner loan - larger amounts, longer terms, property-backed.

4. Green retrofit finance - tailored rates for insulation, heat pumps and solar.

5. Buy now, pay later for materials - short-term, smaller-ticket purchases.

6. Remortgage or further advance - may suit major works if rates align.

7. Savings plus top-up - part cash, part finance to keep payments modest.

Pounds, impact and trade-offs

Who qualifies and how lenders assess it

Eligibility varies by product, but lenders typically assess income, outgoings, credit history and project scope. For unsecured personal loans and instalment plans, stable income and a fair-to-good credit file help, and affordability checks consider your regular bills, existing credit and dependants. For secured loans or mortgage-linked funding, lenders will also review property value, equity and the nature of the works. Larger, structural projects may require planning permission, building control assurance and, for staged drawdowns, evidence of quotes and invoices.

Green finance often asks for proof of eligible measures such as insulation, heat pumps, solar PV or efficient glazing. Installers may need relevant certifications so the lender can validate product standards and warranties. Regional price differences matter - London projects can cost more - and lenders consider realistic budgets against typical ranges for kitchens, bathrooms, extensions and system upgrades.

Kandoo connects homeowners with a panel of UK lenders, so there is a broader chance of a good match on rate, term and eligibility. A single application does not commit you to borrow, and you will see key terms before you decide.

From quote to completion in simple steps

1. Get a firm quote and confirm the project scope.

2. Check affordability with a realistic monthly payment target.

3. Apply online with basic personal and project details.

4. Receive lender options and compare APRs and totals.

5. Upload any requested documents for verification.

6. Review agreement carefully and sign electronically.

7. Funds released or retailer paid - work can start.

8. Track progress and keep invoices and warranties.

The upside and the trade-offs

Read this before you sign anything

Price sensitivity is real, so take a moment to test the budget. Compare monthly payments at a cautious rate assumption and stress it for potential rate changes on variable products. Check whether the quote includes VAT, waste removal, scaffolding and warranties. Ensure payment schedules align with completion milestones, not just delivery. For larger works, keep contingency funds for unforeseen issues behind walls or under floors. If you are considering secured borrowing, understand that your home may be repossessed if you do not keep up repayments. Finally, ask for the total amount payable and any fees for early settlement or missed payments so there are no surprises later.

Alternative routes if finance is not right today

1. Phased works - split the project into manageable stages.

2. Boost the savings pot - delay by six months to increase cash.

3. Grants and schemes - check for regional energy-efficiency support.

4. Employer benefit programmes - salary sacrifice for specific upgrades.

5. Cheaper scope - value engineer materials without compromising safety.

Frequently asked questions

Q: What credit score do I need? A: There is no single threshold. Lenders look at the overall picture - income, outgoings and credit history. A clean, stable profile improves the chance of approval and better rates.

Q: How long does approval take? A: Many unsecured applications receive instant or same-day decisions. Secured loans and remortgages take longer due to property checks and legal work.

Q: Is 0% finance really interest-free? A: Promotional plans can be. Read the terms carefully, as late or missed payments may remove the promotional rate and trigger standard interest or fees.

Q: Should I remortgage to fund an extension? A: It can be cost-effective over a long term, but fees and the mortgage rate matter. Compare the total payable against a shorter personal or secured loan.

Q: Can I finance green improvements like insulation or a heat pump? A: Yes. Specialist products may offer preferential pricing and require certified installers and compliant equipment. Keep all documentation for validation.

Q: Will borrowing affect my home sale? A: Unsecured loans usually do not. Secured borrowing places a charge on the property that must be settled on sale or remortgage.

How Kandoo helps you move forward

Kandoo is a UK-based retail finance broker that connects you with a panel of lenders, matching project size and purpose with fair, transparent terms. Apply online, compare offers in minutes, and choose a repayment plan that fits your budget. Ready to get started? Check your options with no obligation.

Important information

This guide is for general information only and is not financial advice. Credit is subject to status, affordability and terms. For secured borrowing, your home may be repossessed if you do not keep up repayments. Always read the agreement carefully before you commit.