Home Renovation Loans - Rates from 6.3%

Most lenders on our panel offer renovation loans from $5,000 up to $200,000. The amount you're approved for depends on your income, existing commitments, and creditworthiness.

As a rough guide, lenders typically cap unsecured personal loans at 10 to 15 times your monthly net income. Someone earning $6,000 per month after tax could borrow $60,000 to $90,000 unsecured, assuming no significant existing debts.

For larger renovations above $100,000, a secured renovation loan (using a vehicle or other registered asset) may unlock higher limits and better rates. If your renovation exceeds $200,000 or involves structural changes requiring staged drawdowns, a construction loan might be more appropriate.

The average Australian renovation costs around $75,000 according to Housing Industry Association data. At 6.3% over 5 years, that works out to approximately $1,460 per month, or $680 per fortnight.

Choosing between secured and unsecured determines your rate, approval speed, and risk profile. Both are available through Emu Money's lender panel.

A secured renovation loan uses a registered asset (typically a vehicle) as collateral. Rates start lower because the lender has recourse if you default. The trade-off is a longer settlement process (the asset must be valued) and the risk of losing the asset if you miss repayments.

An unsecured renovation loan requires no collateral. Approval is based on your income, credit history, and bank statement conduct. Rates start higher, but settlement is faster (often 24-48 hours) and no assets are at risk.

For most renovations under $75,000, unsecured is the practical choice. You get funds quickly, start your project sooner, and avoid the complexity of asset valuations. For larger projects where rate savings compound over the loan term, secured may save thousands in total interest.

Rates for renovation loans through our panel start from 6.3% (comparison rate from 7.47%). The rate you're offered is personalised based on your credit score, income stability, loan amount, term length, and whether you provide security.

A shorter term means higher monthly repayments but significantly less total interest. On a $40,000 renovation loan at 10.99%:

• 3 years: $1,308/month, $7,088 total interest
• 5 years: $869/month, $12,140 total interest
• 7 years: $689/month, $18,888 total interest

The difference between 3 and 7 years is $11,800 in interest on the same loan. Choosing the shortest term you can comfortably afford is the single biggest lever for reducing your renovation's total cost.

Other cost factors include establishment fees (typically $0 to $495), monthly account fees ($0 to $12), and early repayment fees (many lenders on our panel charge none). When comparing offers, always look at the comparison rate, which bundles fees and interest into a single annualised figure.

If you own property, you may be weighing a personal renovation loan against accessing equity through your home loan. Both work, but they suit different situations.

A personal loan gives you a fixed amount with a defined end date. You know exactly what you owe, when it ends, and what each repayment costs. There's no risk to your property and no need to refinance your mortgage.

Accessing equity (via redraw, top-up, or refinance) typically offers lower rates because your home secures the debt. But it extends your mortgage term, puts your home at risk for what might be a $40,000 kitchen, and involves valuation fees, discharge fees, and potentially weeks of processing.

For renovations under $150,000, a personal loan for renovations is often the more practical path. For larger structural projects where you need staged drawdowns and the lowest possible rate, using equity or refinancing for renovations may make sense.

The break-even point depends on your existing mortgage rate, the personal loan rate offered, and the renovation amount. As a rule: if the rate difference is under 3% and the loan is under $100,000, the simplicity and speed of a personal loan often outweighs the rate saving of a mortgage product.

A renovation loan through Emu Money can fund almost any home improvement project. Unlike construction loans that require council-approved plans, a personal loan for renovations has no project-type restrictions. You decide how to use the funds.

Common projects our borrowers finance include:

Kitchen remodels from $20,000 to $60,000 covering cabinetry, benchtops, appliances and layout changes. Kitchens consistently return 50-80% of their cost in added property value.

Bathroom upgrades from $10,000 to $30,000 for new tiling, fixtures, waterproofing and ventilation.

Outdoor living areas from $15,000 to $50,000 including decks, pergolas, fencing and landscaping.

Energy-efficiency upgrades including solar panels, batteries, double glazing, insulation and efficient HVAC. These projects often pay for themselves through reduced energy bills within 5-7 years.

Extensions and conversions from $80,000 to $200,000 to add bedrooms or convert existing spaces.

Roofing, structural repairs and remediation covering leaks, water damage, mould, or electrical rewiring for safety and compliance.

If your project involves staged payments to multiple contractors, you can request direct-to-supplier settlement. Funds are split and paid to each tradesperson at settlement, keeping your project on schedule.

Renovation loan rates are priced for risk. Stronger borrower profiles attract sharper rates. Here's what lenders assess and how to optimise each factor before applying.

Clean bank statement conduct. Lenders review 3-6 months of transaction history. Avoid dishonour fees, gambling transactions, and consistent overdrawn periods in the months before applying.

Reduce existing debts. Your debt-to-income ratio directly affects the rate offered. Paying down credit cards or closing unused facilities before applying can shift you into a better pricing band.

Choose the right term. Shorter terms attract lower rates on many lender products. A 3-year term may offer 1-2% lower than a 7-year term for the same borrower.

Consider security. If you have a paid-off vehicle worth $15,000+, offering it as security can reduce your rate without changing your lifestyle.

Apply through a broker. Single-lender applications give you one rate. Applying through Emu Money compares your profile against 50+ lenders simultaneously, surfacing the best available rate for your specific situation.

The difference between a 6.3% and a 12% rate on a $50,000 renovation loan over 5 years is $8,200 in total interest. The preparation is worth it.

Fixed rates lock in your repayment for the entire loan term. Variable rates can move up or down with market conditions. Both are available on renovation loans through our panel.

Fixed rate renovation loans (from 6.3%) give you repayment certainty. Your fortnightly or monthly amount never changes regardless of RBA rate movements. This makes budgeting predictable, especially useful when you're already managing renovation costs and contractor payments.

Variable rate renovation loans (from 9.2%) can benefit from rate decreases but carry the risk of increases. They often come with more flexible features like unlimited extra repayments and fee-free early payout.

For most renovation borrowers, fixed is the practical choice. Renovations are a defined project with a defined cost. A fixed rate with a defined end date matches the nature of the expense. You can budget knowing exactly what the renovation will cost you in total, including interest.

Variable may suit borrowers who expect to repay the loan early (for example, from a property sale or bonus) and want to avoid any early termination fees.

Eligibility requirements vary across our lender panel, but most require:

• Australian resident or permanent visa holder aged 18+
• Employed, self-employed, or receiving government benefits
• Minimum income of $20,000 per year (some lenders accept $30,000+ for variable-rate products)
• Ability to demonstrate loan serviceability via bank statements
• Fair credit history (some lenders accept adverse credit)

You do not need to own the property being renovated. Renters can access renovation loans for improvements they're permitted to make under their lease.

Documents typically required:

• Photo ID (driver's licence or passport)
• 3-6 months of bank statements
• Recent payslips or tax returns (self-employed)
• Quotes or invoices from builders or suppliers (not mandatory but can support your application)

Self-employed borrowers can access low-doc renovation loans through several lenders on our panel, requiring 6-12 months of business bank statements instead of traditional income verification.

For borrowers with impaired credit, specialist lenders within our panel offer renovation loans at higher rates. A past default or a low credit score doesn't automatically disqualify you.