Driveways on Finance: A Quick Guide to Driveway Financing

Article Summary:

Financing and installing a new driveway or redoing your existing driveway doesn’t come cheap. That said, it does improve your home’s curb appeal and can also increase your home’s market value. The good news is there are plenty of convenient monthly payment options for driveway financing. Personal loans, credit cards, or leveraging the equity in your house are all driveway financing solutions. You might even be able to secure driveway paving financing through an asphalt or concrete company or a home improvement center.

Curb appeal is one of the most important elements if you’re trying to sell your house. After all, it’s the first thing buyers see as they approach your house, and a neat and tidy driveway adds to the overall appeal. Plus, it’s always nice to roll onto your own driveway and see a space free of potholes, weeds, and cracks.

Read on to learn about various financing options for your new driveway, whether it’s for a relatively cost-efficient asphalt driveway, a more durable concrete driveway, or another driveway paving choice.

Driveway financing options

Fortunately, there are several ways you can finance a new driveway depending on your current financial situation.

Personal loans

An unsecured personal loan is a pretty common way to obtain driveway financing. Personal loans typically don’t require collateral, which also make them a safer option for borrowers but riskier for a bank or credit union.

A personal loan comes with a fixed interest rate, meaning you’ll have predictable monthly payments that can be easier to budget for. One of the potential drawbacks to personal loans is that, because they’re unsecured loans, you may not get as competitive rates as you could with other types of financing, such as a home equity loan. This is particularly true if you have a less-than-ideal credit score.

A good credit score goes a long way toward getting more competitive interest rates, and each lender has a minimum credit score requirement. Depending on your score, your interest rates and loan terms may not be what you hoped for. To get a better idea of the terms you may be eligible for, take a look at our tool below, which shows personal loans available for a 650 credit score.

Home equity loans and home equity lines of credit (HELOCs)

If you’ve built up some equity in your home, a home equity loan or a home equity line of credit are two ways to access that equity and use it to finance your driveway. They’re similar in that they both leverage your home’s equity, but they work a little differently.

A home equity loan is a one-time lump sum payment that comes with a fixed interest rate and predictable monthly payments, much like personal loans. But unlike a personal loan, it’s a secured loan because your house is used as collateral. This means if you default, the lender can come after your house.

Keep in mind, however, that two advantages of a home equity loan over a personal loan are significantly better interest rates and longer loan maturity. A personal loan typically matures in two to five years, whereas you could have 20 years to pay back home equity loans. That could be handy if your driveway installation is especially large, complicated, and expensive, and you need more time to pay it off.

A home equity line of credit is a bit different than either a home equity loan or a personal loan in that you aren’t presented with a lump sum of money. Instead, you’re extended a line of credit, which you can then draw on as needed. Though HELOCs are similar to credit cards, they have much better interest rates because the funds are secured through your home. An added bonus is you’ll have that credit line available if you want to use it for other home improvement projects.

Home equity investments

A home equity investment, also known as a shared equity finance agreement, is a relatively new product that can be an option for homeowners who don’t qualify for traditional home equity financing. It involves giving an investment company partial ownership of your property in exchange for funding. In some cases, they can be a smart way to tap into your home’s equity without getting further into debt. However, they are not for everyone. Here’s all you need to know about shared equity agreements.

Asphalt or concrete companies

You might be wondering if concrete companies — or whomever you hire to complete your driveway project — finance driveways. The answer is yes. Many companies that do home improvement projects will offer financing for their customers, sometimes through a third party, but they might also have in-house financing.

In-house financing might be your best option to finance a new driveway because credit score checks might not even be required (great news for those with bad credit). In addition to that, some concrete companies or others may not charge interest if you pay within a specified period of time. Plus, it’s unlikely there are prepayment penalties if you pay the loan off early.

Credit cards

While not necessarily one of the most competitive driveway financing options, using a credit card to finance paving your driveway is an idea. That said, this is really only if you can’t make other financing options work for you, and paying cash isn’t a choice. However, because of high interest rates, you’ll want to pay off the credit card bill as soon as you can.

Another possibility is to apply for a credit card with a 0% APR introductory rate. Many new credit card offers will give you a year or two at the 0% interest rate, which can save you a ton of money as long you pay off the balance before the introductory period is up. If you don’t, you could have interest rates as high as 20% or more, especially if you have bad credit.

The application process for driveway financing

If you decide to use a personal loan, home equity loan, or another type of financing through a bank or credit union, you’ll need to go through the application process before you can get approved for driveway financing. In any case, lenders will need to know your credit score, credit history, outstanding debt, and total income to approve your loan. You can save time and avoid unnecessary hard pulls on your credit by using SuperMoney’s loan offer engine. Answer a few questions and find out what rates and terms leading lenders are offering.

A personal loan usually has a very simple application process. You can usually complete this online and receive your loan amount in a couple of days. However, because personal loans are unsecured loans, you may need a good or very good credit score to get the best interest rates and loan terms.

Secured loans, such as those borrowing against your home equity, may have lower minimum credit score requirements because you’re using your house as collateral. But keep in mind the application process is much lengthier, you’ll need to pay for an appraisal, and it takes longer to get your money.

How much does driveway paving cost?

Now that you know where to go for driveway paving financing, the next logical step is to figure out the loan amount you need to pay for your new driveway costs.

On average, expect to pay between $2,000 to $5,000 for a new driveway of average size, which is about 600 square feet. Or it may cost significantly more money for specialty driveways, such as curved driveways or ones that are especially large. Let’s take a look into what goes into an estimate for driveway paving.

Driveway materials

There are various driveway materials you can use, and they all affect the cost of your driveway project. Gravel is the least expensive option at roughly $0.75 to $3 per square foot, but it can be a drag to maintain and is not the most stable surface.

Asphalt and concrete driveways are the two most common driveway types as they’re both durable and long-lasting. An asphalt driveway will cost between $2 to $5 per square foot, and a concrete driveway is closer to $3 to $10 per square foot.

Stone pavers are the priciest option at about $10 to $30 per square foot, but with proper maintenance, they can last a lifetime. They are also one of the most attractive options and are most likely to increase your home’s value.

Labor costs

Labor costs are typically built into the cost per square foot of this type of home improvement project. That being said, you’ll want to double check with your contractor to make sure those costs are included.

In any case, request a written estimate so you have a record of exactly what the entire project costs. This can also be useful in deciding which contractor to go with and may help you negotiate a better price.

Pro Tip

No matter which type of driveway financing you decide to go for — whether it’s an unsecured loan, home equity loan, or other loan options — be sure to ask about interest rates, monthly payments, loan terms, and prepayment penalties.


Can I do a driveway myself?

While it’s theoretically possible to do a driveway by yourself, it’s not an easy DIY project if you don’t know what you’re doing. It’s not even that easy if you do know what you’re doing!

But, if you’re a handy person and can get ahold of a dump truck, a skid steer loader, and a bunch of other tools and equipment, maybe you could save yourself some money and do it without a professional contractor. However, you’ll still have to pay for the dump truck and materials, so the extra labor costs may be worth the money.

Can you negotiate on driveway costs?

Yes, you can negotiate the price of almost anything, and that is definitely true of contractors doing work on your home or driveway. The first thing to do is get multiple quotes so you have an idea of what price ranges are in your area. Also, be sure to ask a lot of questions so you know exactly what the entire project entails. The more you know, the better negotiating power you have.

And don’t forget to be polite. Sometimes just asking if there’s anything you can do to get a better price is all it takes to knock a little off the bill. You might also get a discount for doing some of the easy work yourself, such as cleaning off the driveway or cutting back some bushes that are in the way of the work.

What is the cheapest way to do a driveway?

If you want to go super cheap, you can just have a dirt driveway. That won’t cost you a penny. However, unless you live out in the country where dirt driveways are just a natural extension of the dirt road, it can hurt your home’s market value if, say, you’re the only one on your block with a dirt driveway. Not to mention it can hurt your home’s exterior appeal.

Your next cheapest option is a gravel driveway. While this option can look very nice, the upkeep is fairly labor-intensive. You’ll need to add layers to it periodically, and weeds can be a problem as well.

The most affordable driveway option that lasts up to 20 years or more (and requires very little maintenance) is an asphalt driveway. All you really need to do is reseal it every two to five years, depending on your climate.

Is replacing a driveway a wise investment?

That depends. If everyone in your neighborhood has asphalt or concrete driveways and yours is made of gravel, you might want to think about upgrading to a new driveway. This is particularly true if you’re thinking about selling your house.

Your driveway is one of the first things buyers see, and a poorly maintained driveway can also cast doubt on the overall maintenance on the home. Selling is often about perception, and if the exterior of your home (including your driveway) looks poorly maintained, buyers may pass you by in favor of houses with better curb appeal.

Key Takeaways

  • There are a lot of driveway financing options such as personal loans, home equity loans, and home equity lines of credit.
  • Some concrete companies finance driveways in-house for their customers. This is convenient, can be less expensive, and eliminates the need for a bank or credit union.
  • Driveway costs can vary a great deal depending on the square footage, materials, and labor costs needed for your particular driveway installation.
  • A gravel driveway is the cheapest material for driveway paving, but asphalt and concrete driveways are the most common.
View Article Sources
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  2. Home Equity Loans and Home Equity Lines of Credit — Federal Trade Commission
  3. How Much Does It Cost to Build a Duplex House (2022 Update) — SuperMoney
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  14. Home Improvement Loans: 4 Financing Options to Consider — SuperMoney
  15. Are Home Improvement Loans Tax Deductible? — SuperMoney
  16. A Guide to Financing for Home Improvement — SuperMoney