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Home Depot Financing Options: 6 Ways to Pay

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Whether you’re shopping for a home renovation or you just want to spruce up your garden, you have a variety of options for financing your Home Depot purchase. The store offers two options: the co-branded Home Depot Consumer Credit Card and Home Depot Project Loan, but you can also tap traditional payment options, like a zero-interest credit card or a personal loan.

If you’re planning a home improvement project, read on for six Home Depot financing options.

The Home Depot Consumer Credit Card

The co-branded Home Depot Consumer Credit Card from Citi is a good option for frequent shoppers who want to take advantage of special financing offers.

You may qualify for six months of deferred-interest financing on purchases of $299 or higher. If your balance is paid in full during the financing period, you won’t be charged interest. However, the annual percentage rate (APR) is high, and if you don’t pay off your balance within the allotted period, you’ll be charged interest from the purchase date.

Unlike your typical credit card, it cannot be used at other stores. However, during select promotional periods, cardholders can get up to 24 months of special financing. Year-round, cardholders can benefit from rotating offers, like discounts on installed fencing or shed purchases, as well as enjoy 12 months of hassle-free returns (four times longer than for non-cardholders).

The Home Depot Consumer Credit Card terms*

APR17.99%-26.99% variable
APR17.99%-26.99% variable
RewardsN/A
Key features
  • No interest if paid in full within six months on purchases of $299 or more. Interest will be charged to your account from the purchase date if the purchase balance (including premiums for optional credit insurance) is not paid in full within six months.
  • Up to 24-month financing on qualifying purchases during special promotions. The more you spend, the longer you may have to pay off your purchase.
  • Access to exclusive department financing offers and savings throughout the year; including up to 24-month financing on qualifying purchases and discounts on select products/installations
  • No annual fee
  • 1 Year Hassle-Free Returns, credited back to your Home Depot card account.
Penalty feesLate payment fees up to $40

ProsCons

  Special financing available year-round

  Up to 24 months of special financing during select promotions

  Rotating discounts, such as on fence installation or shed purchases

  High regular APR

  Short six-month special financing period

  Deferred interest could make borrowing very expensive

  No credit card rewards, such as cash back

The Home Depot Consumer Credit Card is a good option if you frequent the store and need special financing or want to access occasional discounts. The typical six-month financing period is relatively short, so you should be comfortable paying off your balance within that time frame to avoid deferred interest.

While the card has no annual fee, there are no rewards either, and your card only works at Home Depot. The regular APR is high, so you should always aim to pay down your balance quickly to avoid high deferred-interest charges. If you’re drawn to shopping at competing outlets or rarely need special financing, the card may not be worthwhile.

Home Depot Project Loan

Home Depot’s Project Loan is intended to be used to finance major home improvements. It functions like a line of credit, with a limit of up to $55,000, and it comes with a branded card that can only be used at Home Depot.

If you are approved for a Project Loan, you’ll have a six-month window to buy tools and materials at Home Depot, in store or online. Afterward, you’ll pay down your balance in fixed installments over 66 to 114 months.

Different monthly payment schedules come with different terms. Project Loans don’t have any prepayment penalties, so you can make additional payments to save on interest, and even pay in full whenever you like.

The APR, which can be as low as 7.42%, can make this financing option cheaper than the Consumer Credit Card if you can’t benefit from the card’s six-month special financing offer.

Home Depot Project Loan terms*

APR7.42%-19.96% (fixed)
APR
  • 7.42%-19.96% (fixed)
Borrowing limits
  • Up to $55,000
Repayment period
  • 66-114 months
Loan terms
  • 66 monthly payments at 7.42% APR;
  • 78 monthly payments at 12.86% APR;
  • 90 monthly payments at 16.24% APR; or
  • 114 monthly payments at 19.96% APR
Monthly payment requirementsMaximum $20 per $1,000 spent
Annual fee
  • $0

ProsCons

  High borrowing limits

  Up to 114 months to pay back your debt

  Relatively low APR when you choose a shorter repayment period

  Few special offers

  Can only be used for Home Depot purchases

If you have a large home improvement project and relatively good credit, and you plan to make the majority of your purchases at Home Depot, the Home Depot Project Loan can be a great financing option. With a high borrowing limit and a relatively low maximum APR, the Project Loan could be quite affordable, especially compared to the Consumer Credit Card.

Unlike your typical personal line of credit, however, the Home Depot Project Loan only allows you to finance purchases from the retailer. The six-month spending term can also hinder you if the project takes longer than expected to complete.

Make sure that Home Depot has everything you need before starting work on the project, and look to pay off the loan as quickly as possible to avoid hefty interest charges.

0% interest credit card

If you have strong credit and would prefer a more flexible option to make purchases for your home improvement project, a credit card with a 0% introductory APR may be a better choice over any of Home Depot’s branded products.

Credit card companies commonly offer new cardholders an introductory 0% APR for a select period, usually 15 months or longer. During this time, you won’t be charged or pay interest on purchases you make.

Once the introductory period ends, your outstanding balance will accrue interest based on the regular APR as normal. The average APR across all new card offers ranges from 16.11% to 23.25%, according to LendingTree data.

Savvy shoppers may benefit from various credit card reward programs that offer cash back or miles for everyday purchases. Such rewards can effectively make your purchases cheaper, especially if your particular card offers a higher rewards rate at purchases at stores like Home Depot.

ProsCons

  Can use your credit card wherever it’s accepted

  Low introductory APR

  Potentially lower regular APR than the Home Depot Consumer Credit Card

  Regular APR can be high

  Need strong credit to qualify

  Introductory APR only for new cardholders

While the Home Depot credit card may be convenient for shoppers at the checkout registers, a zero-interest credit card can be a far more affordable option, if you qualify.

Not only can the regular APR on this type of credit card be lower than with the Home Depot Consumer Credit Card, but you could also benefit from a 0% introductory APR that lasts a year or longer and doesn’t charge deferred interest if you fail to pay off the balance in full.

Your card can also be used at a large variety of stores, allowing you to comparison shop for your home improvement project. However, these credit cards require good credit to qualify, and the introductory APR offers are reserved for new cardholders. Further, the regular APR can be higher than those for the Project Loan and other loan products.

Personal loan

Personal loans are fixed-rate installment loans that can be used for just about anything, including home improvement projects. They can be unsecured or secured, and offer borrowing limits that can vary widely.

Since unsecured personal loans don’t require collateral, your credit score is heavily weighed to determine loan eligibility and your rate. For example, in 2021, the average APR for borrowers with a credit score between 640 and 659 was 30.18%, while the average APR for borrowers with a score above 720 was just 10.73%, according to LendingTree data.

Although there are bad credit personal loans, these can have extremely high rates that make them much less affordable compared to the other options discussed here.

Secured personal loans typically have lower rates than unsecured personal loans. They require collateral to back the loan, like a car or other assets. If you have a lower credit score, searching for a secured loan can be a viable path to funding your home improvement project.

ProsCons

  Low APRs depending on the lender and your credit

  Flexible borrowing amounts

  Funds can be used anywhere and for just about anything

  Potentially high APR if you have fair or poor credit

  To borrow more, you’ll need to take out another loan

  Loan may come with an origination fee

A personal loan can be a good option if you know how much money you need to complete your home improvement project and have strong credit. Although you’ll start paying interest on the borrowed amount from the start, you could nab a much lower APR than you’d get once a credit card’s introductory period or special financing offer expires. The APR can also be much lower than with the Project Loan, depending on your credit score.

If your credit score is low, interest rates can be extremely high. Be mindful of additional fees, such as origination fees or prepayment penalties. While certain borrowers may be able to take advantage of no-fee personal loan lenders, origination fees can range from 1%-8%.

Home equity loan

A home equity loan is a secured loan that taps the value in your home and uses it as collateral. This type of loan can pay for major expenses like a kitchen remodel.

Generally, you can access up to 85% of the value of your home, also known as your loan-to-value ratio (LTV). A home equity loan calculator, like the one below, can give you an idea of how much you can borrow.

Similar to a personal loan, borrowers receive money in a lump-sum payment. After paying closing costs (usually 2% to 5% of the loan amount), you’re then responsible for repaying the principal and interest over a set period of time, usually five to 15 years.

Because a home equity loan is backed by your home, you’ll benefit from low, fixed rates and can typically borrow higher amounts. However, because your house is collateral, you could lose your property if you fall behind on payments.

ProsCons

  Low interest rates when compared with a credit card or personal loan

  Potentially high borrowing limit

  Long repayment period and lower fees than other financing options

  Nonpayment could lead to home foreclosure

  Generally need at least 620 credit score

  You’ll reduce the available equity in your home

Because home equity loans tap into the value of your home and are backed by your home, they often come with lower interest rates and higher borrowing limits than other financing options you might use for your Home Depot purchase. Available repayment periods are also long, giving you plenty of time to pay down your debt.

However, using your home as collateral can be risky, especially if your finances aren’t on solid ground. You’ll also need at least decent credit to qualify for a home equity loan.

Home equity line of credit

Like a home equity loan, a home equity line of credit (HELOC) uses your home as collateral. Unlike a home equity loan, a HELOC is similar to a credit card, except you have a specific draw period when you can make charges. The draw period typically lasts around 10 years. Once your HELOC enters repayment, you’ll pay back your outstanding debt on a set schedule.

The borrowing limit is usually up to 85% of the value of your home minus the amount you still owe. Lenders also typically check your credit score and history, employment background, income and monthly debts to determine eligibility.

A HELOC usually comes with a variable interest rate that could rise or fall over the life of the loan. This makes your payments less predictable. Some banks will offer an introductory phase for a HELOC with a low teaser interest rate, but the amount will eventually increase after six months or more.

ProsCons

  Similar flexibility to a credit card

  Lower interest rate than credit card

  Can borrow large amounts on an as-needed basis

  Variable rate makes repayment less predictable

  Set draw period when you can make charges

  A high credit score (at least 740) recommended to qualify for your best rates

  Secured by your home


A HELOC works much like a credit card, offering you flexibility when you need to make multiple trips to Home Depot or other stores. Because your line of credit is backed by your home, you can access lower interest rates than you would get on a standard credit card.

Your interest rate is variable, however, meaning you won’t know how your payments might fluctuate in the future. To get a competitive rate, you’ll need strong credit. As with a home equity loan, if you fall behind during repayment, you risk losing your home.

Home Depot financing options: The bottom line

Renovating your home can be a fun and rewarding process, but paying for it may come with stress and anxiety. With so many financing options for your home improvement project, choosing the best one will depend on your financial situation and purchasing needs.

The Home Depot Consumer Credit Card may be a good fit for your needs if you’re certain that you can pay off the balance before the introductory period ends. But since the card is only good for purchases at Home Depot and doesn’t offer any rewards, you may find better terms and more flexible purchasing power with a standard consumer credit card, especially if you have strong credit.

For larger projects, the Home Depot Project Loan offers shoppers a higher borrowing limit, but again, a personal loan or home equity loan can offer greater flexibility and may come with better terms. Although both of Home Depot’s financing options have their strong points, you are likely to find better terms and a lower overall cost of borrowing with another form of funding.

Home Depot financing options: FAQ

Is it hard to get financed through Home Depot?

The APR and credit limit you may qualify for will depend on creditworthiness, but the application process appears to be simple. Shoppers who are interested in Home Depot’s financing options can apply online or in store. Expect to provide information about your income and credit history.

What credit score is needed for a Home Depot credit card?

Home Depot does not disclose the qualification requirements for their credit card, but generally, it is easier to qualify for a store credit card than a regular credit card. Often, consumers will need fair credit or better to qualify for store credit cards. If your credit score needs work, you should expect a higher APR and lower credit limit.

What can I buy with Home Depot financing?

Home Depot’s branded financing options can only be used to pay for purchases made at Home Depot. Unlike general-use credit cards, store-branded credit cards can typically only be used at the issuing retailer. So of course, you could not use a Home Depot credit card to make a purchase at Lowe’s. If you think you’ll need to finance purchases from other stores, it could be worth considering alternative financing options, such as a 0% interest credit card or a personal loan.

 

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