With expectations that the real estate market will remain more or less subdued, and with luxury homes mostly at historic lows, many homeowners now opt to give their homes fresh updates or add-ons in lieu of stepping into a turnkey home with all the amenities.

Ryan Chamberlain, Market President at FirsTier Bank in Broomfield, has his finger on the pulse of the region’s home-improvement market and helps customers find the right financial solutions to fit the scope of any size project. The Broomfield branch opened about two and a half years ago and joins those in Greeley and Castle Rock as the three FirsTier Banks in Colorado. Seven additional branches are in Nebraska and Wyoming.

Popular home-improvement projects that add value to your home might include updating or building new kitchens, master suites and bathrooms, finishing basements and outdoor living spaces. Mr. Chamberlain stated that home improvement projects are gaining in popularity. He suggested calling multiple banks to ensure you are getting the most competitive rate and term possible. In addition, he advised me to interview the bank. Ask probing questions to ensure you fully understand the process.

“What sets us apart from competitors is our customer service and follow-through,” he explained. “We complete a thorough evaluation of the home on an “As Is” and “As Completed” basis. When analyzing a credit request, we are looking at the borrower’s cash flow, credit score, equity in the project and the general contractor completing the remodel. This is all done to ensure the client and bank are protected”.

When it’s time to finance your home improvement project, homeowners have six options:

Cash-out refinance

A cash-out refinance is where your new loan is greater in value than what you owe on the old loan – allowing you to “cash out” the difference minus closing fees.

Home equity loan/home equity line of credit (HELOC)

A home equity loan and a home equity line of credit are similar in that they both use your home as collateral and offer competitive interest rates. The key difference is a home equity loan offers a single lump sum at a fixed rate, whereas a HELOC offers a line of credit at a variable rate that you can then draw upon over time.

Personal loan

If you have a strong credit score and prefer a quick payout, a personal loan can be a great option for financing small to midsize home improvement projects. Personal loans are not backed by your home or another asset, making them unsecured loans.

Credit cards

Small, low-cost home-improvement projects, are sometimes best financed with credit cards. The caveat is that this option works best if you pay off the card every month. Extending payments will rack up high-interest fees and increase the cost of the project, sometimes exponentially.


Cash is king and by using cash reserves to pay for home improvement you avoid all those extra fees that come with interest rates, closing fees, etc. If you have cash reserves, this could be a viable option. If not, you’ll want to exercise patience and set up a savings plan to cover the cost.

By Luanne Kadlub, AH Luxury