Which To Choose For Home Renovation- Revolving Line Of Credit Or Personal Loans?

A home is a place that contains a lot of memories and reflects your style and personality. With the latest designs and trends, you make your home more customized according to your choice. Moreover, you might want to renovate or remodel your home for an upcoming festival or a family function. But, the cost of renovating your home can put a burden on your savings. Thus, if you are looking for instant funds, this article will help you resolve your confusion. This article will give better knowledge about revolving lines of credit and personal loans to help you make an explicit and informed decision on which to choose.

Before going deeper, let us look at revolving lines of credit and personal loans

What Is A Revolving Line Of Credit?

A revolving line of credit is a loan that allows you to borrow money and repay it continuously. This type of loan has a credit limit; each time you use the credit to purchase something, your available credit balance will reduce. And each time you make a payment, your general credit balance increases. Therefore, it goes on like an endless cycle where you can use the card, pay the dues, make new purchases and so on.

How To Use Revolving Line Of Credit For Home Renovation?

When you want to use a revolving line of credit for home renovation, there are options from which you can choose, namely:

  1. Home Equity Line Of Credit (HELOC)
  2. Line Of Credit (LOC)
  3. Credit Cards

Now, let us look deeper into each of these credit products mentioned above.

Home Equity Line Of Credit (HELOC)

Home Equity Line Of Credit is a type of revolving credit that converts your home’s equity (or the market value) into accessible funds. You can borrow money against a portion of your home’s equity as it is collateral for the loan. Home equity credit is sometimes a good choice if you have high equity built on your home. And as the loan is secured, it offers better interest rates than other alternatives. Moreover, a HELOC is flexible when you borrow the money as it is a revolving credit.

Line Of Credit (LOC)

A line of credit is an unsecured loan similar to credit cards. You don’t have to submit any collateral to apply for this loan. And you have to have a high credit score to qualify for this loan. Therefore, these lenders offer this loan mainly based on your creditworthiness. Once your loan is approved, you can use the money upto a j4rxcertain credit limit. You have only to pay the interest charged on the amount you take. However, the interest rates are quite high compared to the Home Equity Line Of Credit (HELOC).

Credit Cards

These are the most commonly used forms of credit. It is also an unsecured loan where you can open a credit card account and use that card to borrow money to make purchases upto a certain credit limit. And when it comes to home renovation, credit cards must be your last option because the Annual Percentage Rates (APRs) are high, making it a very expensive form of debt. 

What is a Personal Loan?

Personal Loans are unsecured loans offered by banks and other lending institutions to cover sudden financial requirements. You need not pledge any of your assets as security to apply for this loan. These loans are offered based on your credit score to determine your repayment ability. Moreover, you must frequently check your score using Buddy Score to keep track of your financial status. 

The biggest advantage of a personal loan is that you can use it for various financial requirements such as home renovation, medical emergencies, travel expenses, business expansion, etc. Therefore, You can easily apply for a personal loan using Buddy Loan, as it is one of the best loan aggregators that help you get a personal loan at affordable interest rates. 

Therefore, if you plan to renovate your home, you can easily take a personal loan to meet these expenses. You can get this loan amount disbursed to your bank account within 24 to 48 hours of verification. Moreover, you can repay your loan through monthly EMIs with a tenure period starting from 6 months to 5 years. 

Eligibility Criteria

2Age21 to 60
3Employment StatusEmployed or Self-Employed
4Minimum IncomeINR 20,000 per month
5Work ExperienceMin 1 year completed
6Credit ScoreAbove 750

Documents required

Sl. No.ParticularsDocuments required
1Proof of IdentityAadhar Card, PAN Card, Driving License, Passport
2Proof of AddressElectricity Bill, Water Bill, Passport
3Proof of IncomeSalaried: Bank statement for the past six months
4Work experienceEmployment Certificate for a minimum of 1-year experience

Also read: Important things to be aware of about the latest cash loan apps


When you want to renovate your home, you can choose to take a revolving line of credit or a personal loan depending on your repayment ability. And the decision of repayment depends on factors such as your project size, credit score and home equity. Therefore, depending on these factors, you can decide whether to purchase a personal loan or revolving credit.