Considering a replacement?

Replacing the siding on your home is a much larger commitment than, say, changing your interior paint or switching up your backyard landscaping. In addition to a heftier price tag, your choice of siding has a major impact on your home’s aesthetics, functionality, and even market value when it’s time to sell.

Here’s what you should know about financing your siding project.

How much siding financing will I need?

The total cost of your siding project will factor into your choice of financing. The good news is that you don’t need a contractor to submit an estimate; you can do most of the calculations yourself.

To begin, draw an outline of your home’s exterior walls, breaking them into rectangles and triangles. Then take measurements of your walls and add them to your drawing. Calculate an estimated total area (for rectangles, use H x W, and for triangles, use one-half of H x W). Once you’ve arrived at a total square footage figure, use the following price estimates to arrive at a total cost for your project:

• Vinyl siding – $2 to $7 per square foot.
• Wood siding – $3 to $10 per square foot.
• Engineered wood siding – $2.50 to $5.50 per square foot.
• Aluminum siding – $2 to $5 per square foot.
• Corrugated steel siding – $4 to $8 per square foot.
• Fiber cement – $1 to $5 per square foot.
• Brick – $6 to $12 per square foot.
• Stone – $15 to $30 per square foot.

You may have additional costs for removing and disposing of your existing siding, modifying the framing or HVAC and electrical systems, if necessary, installing the new siding, and for complying with any permit or inspection requirements in your area. If you are using a general contractor to supervise the work, add another 15% to 20% of the total cost to cover contractor fees.

The national average for new siding projects was just over $9,000, with high-end siding installation running upwards of $26,000.

What are your lending options?

With all home improvement projects, you generally have four choices for financing: Save up and pay with cash, or get a home equity loan, a personal home improvement loan, or a home improvement credit card.

Let’s look at when each of these makes the most sense for siding financing.

Paying in cash

If you are replacing your siding for purely aesthetic reasons, you may want to save up for a year or two until you can pay for your project in cash. Using cash for your siding project will help you avoid the interest and fees attached to any siding financing option.

However, if your existing siding is rotting, damaged, or leaking, you really can’t afford the luxury of saving up cash. And if you’re trying to sell your home quickly and move, you may want to replace unattractive siding right away to improve curb appeal and market value.

Put differently, if time is of the essence in your siding replacement or repair project, you should consider financing your siding project.

Using a home equity loan

If you have enough equity in your home to cover the cost of your siding financing, a home equity loan or line of credit might be a good option. Siding is one of the better home improvement investments, adding about 93% of the cost of the project to the value of your home, compared to just 56% for a bathroom remodel, for example.

Home equity loans generally have lower interest rates than other types of siding financing solutions, and their long loan terms (usually between 15 and 30 years) mean lower monthly payments.

However, there are several drawbacks to home equity loans, not the least of which that your house becomes collateral for your siding debt—your lender can foreclose if you don’t make your payments on time. You also may not have enough home equity to finance your siding project with a secured option.

These loans are also very expensive to obtain, with high application fees, appraisals, and other assorted fees depending on your lender. In some cases, you may have to pay points, which are a percentage of the total loan amount, to lock in or “buy down” a lower interest rate. And if you want to pay your loan off early, you may be socked with a hefty prepayment penalty.

If your siding project is urgent, you probably should consider another financing option, since home equity loans usually take four to six weeks to close.

Signing up for a personal home improvement loan

A zero equity home improvement loan can be a very sensible choice for your siding project, especially if you lack adequate equity in your home for a home equity loan and your siding repair is urgent.

You can get home improvement loans for up to $35,000, more than enough to cover even a pricy stone siding job. There are several other advantages to these loans, as well:

Loan terms of between 3 and 7 years with no prepayment penalties. You’ll pay off your siding more quickly than with a home equity loan—and you can pay it off early if you have extra cash.

There are no hidden fees or appraisal expenses, and it costs you nothing to apply. You simply pay a one-time loan origination fee when your loan is approved.

Fixed, predictable monthly payments mean you can budget for your new siding responsibly.

Most loans are approved within 24 hours and funded in as little as 1-2 days. You can get started on your siding project right away.

In most cases, you’ll need a credit score of 640 to qualify for a personal home improvement loan, so if your credit isn’t where you want it to be, you may not be able to get a loan, or you’ll pay a much higher interest rate than those with better credit.

Applying for a home improvement credit card

Many lenders offer a 0% introductory interest rate, usually for the first 6 to 18 months, on home improvement credit cards.

If you have a smaller project like a siding repair job (average cost of $300 to $1,000), and you can pay it off during the introductory period, you’ll pay no financing costs for your siding project.

Home improvement credit cards are great for DIY siding repairs; you have more flexibility to just charge your materials as you go at your local home improvement store.

Credit cards are generally best for those times when you need a smaller amount of cash for a shorter period of time. However, if you have excellent cash flow, you can use your card to pay for even larger siding replacement projects.

Just remember that once your introductory rate expires, your monthly payments go up quickly, so be sure to take a good look at your budget and determine what you can realistically pay toward your balance each month. 

If you don’t think you can pay off your card during the introductory term, you may want to consider other siding financing options.

How Hearth can help

If you’ve got an urgent siding project coming up and a home equity loan isn’t for you, Hearth can help you find the best terms on personal home improvement loans and home improvement credit cards through our broad network of lending partners. 

We can also help you choose the right siding financing option with our home improvement financing comparison tool.

When you’re ready to get started:

• Click to fill out a personal home improvement loan or home improvement credit card application. It takes 60 seconds to complete and doesn’t affect your credit score. Our application also uses the same security as your bank.
• Review your options from our lending partners and choose the one that’s right for you.
• Complete the loan process with the lender you choose—and wait for your money. Most loans are funded within just a day or two.
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Let Hearth show you how easy it is to get your new siding project off the ground with a home improvement loan or credit card.

Visit the links below if you need financing for other home improvement projects:

• Bathroom remodel
• HVAC 
• Kitchen remodel
• Landscaping
• Plumbing 
• Roof
• Swimming pool