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Inground Pool Financing: Installation Costs & More

September 14, 2021 · 6 minute read

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Inground Pool Financing: Installation Costs & More

Few things in life are as refreshing as a cool dip in a sparkling pool on a hot day, and rather than pay to use a community pool, wouldn’t it be nice to have one in your own backyard?

If you’ve been thinking about building an inground pool, there are several things you need to think about: DIY or professional build, pool designs, and landscaping, as well as financing a pool.

Deciding to DIY Your Pool

Building your own pool is usually less about the actual building and more about acting as your own contractor. If you’re familiar with the ins and outs of contracting home improvement projects, what permits are necessary for your locality, know what equipment you’ll need and where to get it, and are comfortable with getting a little dirty, then building your own pool might be right up your swim lane.

But it’s a big job, so doing your research and making sure you know exactly what you’re doing is key before starting on a project like this.

Popular Mechanics provides a helpful how-to article on building your own inground pool and explains the following: “There’s nothing like installing a concrete swimming pool to one-up your neighbor’s above ground version. But planning your dream pool can be harder than it first seems. Consider your options and obligations before breaking ground, and in-ground pool construction will proceed swimmingly.”

Or, if you’re all thumbs, then it may already be clear that hiring a contractor is the only practical choice.

Choosing a Pool Installation Contractor

If you decide to hire a contractor to install your inground pool, then the Better Business Bureau® (BBB) offers tips on hiring a reputable one. According to the BBB, common complaints against swimming pool contractors, dealers, and design companies include:

•  Refusals to do repair work covered by warranties.

•  Projects not finished in a timely way.

•  Workers making a mess.

Before hiring someone, it’s always a good idea to research contractors in your area. You can conduct research via the BBB website or by looking at various customer reviews online. Ask friends and family members for recommendations or ask contractors you may already know for references.

You may want to ask whether the contractor you’re interested in hiring is licensed, with both liability and workers’ compensation insurance. Ask if permits are needed—and you might want to stay away from any contractors who say they don’t understand what’s required. A good rule of thumb is to work with companies that give you a written contract—one you feel comfortable signing—and keep a copy.

How Much Does a Pool Cost?

According to Home Advisor , the average cost to build any pool in 2021 is around $30,000, and the cost to build an inground pool falls between $36,750 and $66,500. That price can quickly top out at $100,000 if you add on specialty features like a waterfall, spa, or lagoon.

There are a variety of factors that can affect the cost of the pool you want to build, including where you live, size of the pool, building materials, and filtration systems.

Don’t forget that the pool itself is typically only about half of your total investment. That’s because of the extras involved and the maintenance required. If you want a clean pool, maintenance is not optional.

What about a deck? A covered area for shade? Fences, privacy screens, and outdoor sound systems? Patio furniture? A pool house, cabana, or equipment shed? You’ll likely want extra outdoor electrical outlets and water test kits, too.

Then there is landscaping. The Spruce offers suggestions for full pool landscaping projects. It’s important to choose plants that will thrive next to a pool and ones that will look attractive with the rest of your home’s landscaping.

Finally, where will people sit? You’ll want chairs and chaise lounges that look attractive, mesh with your overall outdoor decorating scheme, and are comfortable. Tables should include umbrellas, or you should provide an alternate source of shade.

As you can see, the answer to “How much does it cost to build a pool?” involves much more than just the pool itself. Fortunately, there are pool financing options for your new addition.

Financing a Pool Installation

No matter what pool design, landscaping choices, and pool deck layout you decide on, it’s important to consider your pool financing strategically and whatever you choose depends on your financial situation and your comfort level with debt repayment. Credit cards can be a tempting choice, but they may come with high interest rates. So, unless you’re using your credit card on a very short-term basis—paying it off in, say, 30 days—other financing options may offer alternatives for certain financial situations.

Cash-Out Mortgage Refinance

Homeowners who have paid down their mortgage enough so that they have some home equity built up may consider refinancing their home and taking some cash out for a home improvement like a swimming pool. A cash-out refinance is basically a new mortgage in an amount in excess of what is owed on the current mortgage. The new loan is used to pay off the existing loan, and the borrower then takes the difference in cash.

Pros of a Cash-Out Mortgage Refinance:

•  If your existing mortgage rate is higher than current mortgage rates, you may be able to qualify for a lower rate on the new mortgage.

•  Mortgage interest on a cash-out refinance may be tax deductible if the funds are used for improving a home’s value. The IRS has specific rules on what it considers substantial improvements .

Cons of a Cash-Out Mortgage Refinance:

•  A cash-out refinance is a trade: your equity for cash. This means the equity in your home will be lower than it was before the refinance and it will take time to build it back up.

•  Your home is your collateral, and if you can’t repay your mortgage, the lender can opt to foreclose.

Home Equity Line of Credit (HELOC)

Another option for homeowners who have equity in their homes might be a home equity line of credit (HELOC) for pool financing. A HELOC is a type of revolving credit line secured by your home equity.

Pros of a HELOC:

•  Because it is a secured loan, using your home as collateral, a HELOC may have lower interest rates than you might qualify for with an unsecured loan.

•  Since a HELOC is revolving credit, you only borrow and pay interest on the amount you need, up to your approved credit limit. And you can repay and borrow again from the same pool (pun intended) of money during the draw period.

Cons of a HELOC:

•  A HELOC is typically a variable rate loan, so your monthly payment will fluctuate with the prime rate.

•  As with a cash-out-refinance, your home is your collateral, and if you can’t repay your mortgage, the lender can opt to foreclose.

Home Equity Loan

Yet another option for homeowners who have built up equity in their homes, a home equity loan can also be used for pool financing. A home equity loan allows you to borrow a lump sum against the equity in your home. So, if you’re fairly sure how much your pool will cost, this could be a viable option to finance it.

Pros of a Home Equity Loan:

•  Home equity loans are generally fixed-rate loans for a specific length of time, which means the monthly payment will be the same amount for the life of the loan.

•  This might be a good alternative to a cash-out refinance for borrowers who have a low interest rate on their primary mortgage and aren’t interested in refinancing.

Cons of a Home Equity Loan:

•  A home equity loan is a second loan, on top of your existing mortgage, which increases your monthly expenses.

•  Again, your home is your collateral, and—this cannot be emphasized enough—if you can’t repay your mortgage, the lender can opt to foreclose.

Pool Financing Through a Dealer

Depending on your swimming pool dealer, you may be able to arrange financing by having the company forward your information to lenders. Know, though, that dealer-arranged financing is typically through a third party and is one of the more expensive options for financing a pool because the rates will likely be far higher.

Pros of Dealer Financing:

•  It can be convenient to work with a lender your dealer has an established relationship with and whose application process the dealer is familiar with.

•  If you don’t have enough equity in your home to qualify for a loan that uses your home as collateral, dealer financing could be an option that works for you.

Cons of Dealer Financing:

•  Dealer-arranged financing may not offer the best rates or terms compared to other financing options.

•  You may be limited to working with the financing company or companies that the dealer partners with, which limits your options.

Personal Loan

Using an unsecured personal loan to finance your pool can be an option for the financing you need in a fairly short amount of time. If you qualify for a low enough interest rate, you could pay off your new pool with low monthly payments. Check out this personal loan calculator to estimate the difference between using a credit card or an unsecured personal loan to finance your pool installation.

Pros of an Unsecured Personal Loan:

•  If you have good credit, but not a lot of home equity, you may be able to qualify for a low interest rate.

•  There is no need to use your home as collateral or tap into your home’s equity.

Cons of an Unsecured Personal Loan:

•  If you don’t have strong credit, you may not qualify for the most competitive interest rates.

•  In general, unsecured loans tend to have higher rates than loans secured by collateral, such as home equity loans or HELOCS.

The Takeaway

An inground pool can add to your own personal comfort and might also be an attractive addition to buyers if you’re considering selling your home in the future.

Since building an inground swimming pool is such a large expense, some people might rather finance the purchase instead of dipping into liquid cash or a savings account.

Wondering how you’re going to finance a pool? You could consider taking out an unsecured personal loan to cover the cost. Using a SoFi Personal Loan could cost less in interest than using a credit card to finance an inground pool. Plus there are no fees or prepayment penalties with an unsecured personal loan from SoFi.

Ready to dive in? Explore SoFi Personal Loans for financing your pool.


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Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
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