What is Pool Financing?

Pool financing is a type of loan or credit line that can be used to pay for a new pool over time. Common pool financing options include home equity loans, secured or unsecured personal loans, home equity lines of credit (HELOCs), or direct financing from a pool dealer, all of which can make owning a pool more obtainable for many homeowners.

What is Pool Financing?

Pool Financing Options

When researching the best way to finance a pool, the wide range of options available can seem overwhelming at first. But typically, there are three main categories of pool financing to be aware of: in-house pool loans, financing that leverages the equity in your home (like home equity loans or HELOCs), and personal loans.

Pool financing is not one-size-fits-all, which is why it is important to carefully consider the pros and cons of each to ultimately decide which type of financing best fits your needs.

In-House Pool Loans

One of the most common ways to finance a pool is to work with your pool dealer to secure a pool loan through one of their preferred lenders. This is a popular option for homeowners because it is convenient and helps streamline the process, as your pool dealer will be able to speak to what information is required, help with paperwork and answer any questions you might have. This ultimately helps speed up the process and can help increase your chances of getting approved for the loan, which is win/win for everyone.

While an in-house pool loan may offer customers a level of convenience, it may not always offer a homeowner the best rate or term. It’s always worthwhile to shop around to find the lowest rate and terms that you are most comfortable with.

Latham has partnered with two trusted industry leaders in Lyon Financial and LightStream to provide pool loans to customers directly.

In House Pool Loans

Home Equity Loans & HELOCs

Home equity loans and home equity lines of credit (HELOCs) are a common way of financing a new pool. With both, you’re able to draw upon the equity of your house. However, there are some key distinctions between these two types of financing options.

A home equity loan, or “second mortgage” offers fixed interest rates over a fixed loan term. A HELOC works similar to a credit card, where you’re offered a line of credit based on the value of your home and are able to draw upon it as needed, for the length of the loan term. HELOC interest rates are typically variable rather than fixed, making it more difficult to predict what exactly you’ll owe.

Because you’re using your home as collateral, you typically are able to get a lower interest rate. However, if you default or fall behind on payments, you can potentially lose your home, so it is important to stay current.

Leveraging the existing equity in your home can be a great way to finance your pool. It’s a natural fit, as by adding a pool you’re making an investment in your home and intend to stay for a while!

Home Equity Loans, HELOCs

Personal Loans

Personal loans are typically unsecured loans that you get from a financial institution or online lender that can be used for a wide-range of purposes, including a new pool. Unsecured loans are based on a person’s credit history and don’t require property to be used as collateral in order to secure the loan. Because these loans are for personal use, they are typically more flexible, have less stringent requirements and can be acquired fairly quickly, making them a good option for those looking to finance a pool, but do not want to use their house as collateral or do not have significant equity.

While unsecured personal loans do not require collateral, they typically have higher interest rates. These types of loans also usually have fixed terms ranging from 12-84 months.

Personal Loans

Latham’s Preferred Financing Partners

Latham Pools has partnered with Lyon Financial and LightStream as preferred lenders.
Learn more about these options and apply today:

Lyon Financial

Lyon Financial Pool Loans

Lyon Financial is different from other financial organizations in that they have specialized in pool loans since 1979. As a result, they have a knowledgeable team that can help guide you through the pool loan process and offer personalized service. As an additional value add, Lyon Financial will partner with the homeowner and pool professional until the project is complete.

With pool loans from Lyon Financial, you can get loans of up to $100,000 for terms of up to 20 years. They also offer low, fixed rates, with no consulting fees or prepayment penalties.

Learn more about Lyon Financial and get in touch with one of their knowledgeable representatives today.

Read More About Lyon Financial
Lightstream

LightStream Pool Loans

For homeowners looking for a more-self serve lender, Latham Pools has partnered with LightStream. A premier online lender, LightStream offers fast, easy pool loans of up to $100,000 at low, fixed rates without
any fees or prepayment penalties for customers with good to excellent credit.

This is a good option for customers who are more financially savvy or already know what they’re looking for from a loan and don’t need as much support from their lender.

Learn more about LightStream and apply today.

Read More About LightStream

Swimming Pool Financing 101

While the process for obtaining a pool loan will likely look fairly similar to most other types of loan applications, there are some parts that are specific to swimming pool loans.

How Does A Pool Loan Work?

Step One

First, before you begin the loan application process, you should have the following documents and information ready to share with the financial institution:

  • Social security number (SSN)
  • Driver’s license number
  • Proof of employment
  • Proof of income
  • List of assets
  • List of liabilities
Step Two

The process begins when you submit a loan application. From there, your application will be reviewed and a credit check will be run. At this point, the loan will either be denied or conditionally approved. If you are conditionally approved, the lender will typically request documentation to verify your income (such as tax returns, W-2 or a recent paystub).

Step Three

Once this is completed and a copy of the signed contract between you and your pool dealer is in hand, loan documents are ordered and sent electronically. After the documents are signed and returned, your builder is given a green light to begin construction.

Step Four

If you’re getting a pool loan through a lender that specializes in pool loans, like Lyon Financial, they’ll be able to guide you through the process and answer any questions that you might have. They will also help facilitate loan disbursement, which for pools is usually done in stages as the project progresses.

Homeowners often wonder if they can finance a pool into a new mortgage. The short answer is yes, but it will likely depend on your mortgage lender and specific financing terms.

There are a couple of ways to go about combining your pool loan into a mortgage:

  • Factor it into a new mortgage: If you decide early on in the home buying process that you want to add a pool to your new home, you might be able to consolidate the cost of your new pool directly into your new mortgage. However, not all lenders will allow this, so you will need to ask to see if this is possible.
  • Refinance and cash out: Alternatively, if you already own a home and have a mortgage, you can potentially refinance your existing mortgage and cash out some of the equity in your home to pay for your new pool.
  • Take out a second mortgage: Another popular option is to take out a “second mortgage” in the form of a home equity loan.

Financing your pool in this way can help you get a better interest rate and streamline both the application and payment process.

When determining if a pool loan is right for you, it is important to understand what to expect with a typical loan. While specific loan terms may differ depending on your needs and circumstances, generally speaking, most pool loans have a term length of 3-15 years, with interest rates anywhere from 3.5% to 20%.

Read on to learn more about typical pool loan terms. To get more information about specific loan terms, visit our partners, Lyon Financial and LightStream.

Interest rates for pool loans depend on a number of factors, including credit profile, loan amount and income.

Generally speaking, average pool loan interest rates fall in the 5-10% range on average , but can be as low as 3.5% and as high as 20% . What interest rate you qualify for will largely depend on your creditworthiness.

What is the average interest rate?

Your lender can help you shop around for the best interest rate or you can use an online lender to shop around for rates yourself.

Monthly payments on your pool loan will vary based on a number of factors, including the loan term, interest rate and amount financed.

To put this in perspective, a $30,000 loan over 84 months could cost anywhere between $400-$500 per month. A $40,000 loan over the same term would result in a monthly payment of $550 to $675, while a $50,000 loan would cost about $700–$850 per month.

However, if you extend your loan term beyond the standard 84 months, you can lower your monthly payments considerably, making a pool more attainable for many. The trade-off is that you will likely pay more interest on the loan over time.

For example, if you choose a 180-month loan term, your average monthly payment could be $200-$300 less. If you finance $50,000, your payments might be around $395 per month. A $30,000 pool would cost less than $250 per month.

You can also lower your monthly payment by putting a down payment to reduce the amount of money you’re ultimately financing.

Using a swimming pool loan calculator like the one Lyon Financial provides can help you get a feel for how these factors impact your monthly payment.

The average length of a pool loan can range anywhere from 1-20 years, depending on your needs and how much you need to finance.

As mentioned, the length of time you finance your pool for can have a significant impact on your monthly payments. If you choose a shorter loan term, your monthly payments will be higher, but you will ultimately pay less in interest. If you go with a longer term, your monthly payments will be lower, but you’ll pay more in interest.

Five- to seven-year loans tend to be a popular choice, because they help spread the cost of the pool over enough time that your monthly payments are relatively low, but you don’t rack up decades of interest.

Average Length of a Pool Loan

Ultimately, the length of your pool loan that you choose is up to you and what best fits your needs — and your budget!

If you’ve decided that a pool loan is right for you, the next logical question is what credit score is needed and if you qualify.

When evaluating a loan application, lenders ideally want at least five years of credit history consisting of a variety of account types (such as mortgages, vehicle loans and major credit cards) with a record of consistent on-time payments. Additionally, lenders will also consider your income and debt-to-income ratio to help determine your ability to repay the loan.

Typically, lenders are looking for a credit score of at least 660. As with any loan, those with good-to-excellent credit (740+) will get the better interest rates and lower monthly payments.

However, even if you have “bad” credit, it may still be possible to get a pool loan. But, beware, as this will likely come at the cost of a significantly higher interest rate, adding to the overall cost of the pool.

Helpful Tools

Pool Financing Calculator

If you want to get a general idea of how much a pool might cost to finance, before you apply, using a pool financing calculator can help. To get started, simply add key inputs like how much you want to finance, interest rate, loan term length and any down payment and it will calculate your expected monthly payment.

Pool Financing Calculator