Home Improvement Finance

Hot Tub Financing: Top Options for Buyers

Finally, getting to purchase your own hot tub or spa can be a dream come true. Whether it’s to soothe aching muscles, entertain parties, relaxing with your significant other, or simply everyday stress relief, you can have it all right there at home.

How Much is it to Finance a Hot Tub?

Hot tubs don’t come cheap. Depending on the type and quality of your hot tub, prices can range anywhere between $3,000 — for a basic above-ground hot tub — and $20,000, for a high-end in-ground spa.. With financing, that cost could increase depending on your interest rate and how long it takes you to pay off the loan.

Steps to purchase a hot tub:

  1. Establish a budget – how much are you willing to spend?
  2. Visit your local dealers. Shop around to see what kinds of hot tubs are out there.
  3. Consider the ongoing and total costs of owning a spa.
  4. Consider the following payment options: Paying with cash, a HELOC, taking out a personal loan, or using credit cards.
  5. Make your final decision – the hot tub of your dreams is finally yours!

Can you Finance a Hot tub?

In short, yes! In fact, there are multiple ways to buy a hot tub if you do not have the cash to pay for it upfront. We’ve gathered four options for you to consider. Read on to find out how you could make your dream of owning a hot tub a reality sooner than you think!

What Credit Score Do I Need to Finance a Hot Tub?

Generally, your credit will need to be considered “fair” to obtain most loans. Some firms will offer loans to those with poor credit, but it isn’t very common. This means your credit score will typically need to be at or above 620.

Can You Finance a Hot Tub with Bad Credit?

Depending on the lender, you may be able to get a loan with a score lower than 600, but the terms will be very limited, and your interest rate will be higher.

Option 1: Buy with cash

This is the most cost-effective way to pay for your hot tub. You don’t need to worry about paying interest or having a monthly payment. And if you’re generally debt-averse, paying with cash can help you avoid the stress of having your credit and financial future on the line.

The main drawback of using cash to finance your hot tub is that the cash is no longer available for other financial goals. It can also be difficult to save enough money to purchase a hot tub in cash upfront. If you can get a low enough interest rate on a loan, you’ll have more flexibility to spread your cash.

Option 2: Hot tub financing with a home equity loan

Since adding a hot tub can increase the value of your home, it may make sense to get a home equity loan or use a home equity line of credit (HELOC). Since the loan correlates to your improvements on your house, it is possible to qualify for rock-bottom interest rates.

Loan funds can also be used for installation, landscaping, or anything else related to their hot tub installation such as a platform/deck, enclosure, surround sound, and lighting.”

Before you do this, though, make sure you have enough equity in your house to cover the hot tub. Equity is defined by how much the house is worth minus the outstanding loan amount. So, if you get your house appraised at $300,000 and you have $245,000 left on your mortgage, you have $55,000 in equity.

The biggest drawback to this option is that your home is collateral on the loan. This means that if you default and are unable to make your monthly payment, you could lose not only your new hot tub but also your house.

Home equity loans and HELOCs also come with high fees. Therefore, it may not be worth it unless you think the lower interest rate will balance it out.

It is also possible to get a home improvement loan without any equity. Check out this guide for more info.

Option 3: Hot tub financing with a personal loan

The best thing about personal loans is that you can use them for just about anything. The process can be very fast, and the loan will likely be unsecured.

With an unsecured loan, you won’t have to put up your hot tub or anything else as collateral in case you default on the payments. With good credit, you’ll most likely qualify for a low interest rate, which can be in the single digits.

Depending on how much you can afford, you can also choose a short or long repayment term. Just keep in mind that quicker repayment terms typically come with lower interest rates.

Rates, fees, and terms vary widely depending on the lender, so it is important to compare the best personal lenders before you choose.

The main drawback to a personal loan is that you may not get a low enough interest rate to compete with a hot tub-specific loan. What’s more, the lender may require a shorter repayment period, forcing you into higher monthly payments. For example, a loan with a term of 24 months would have a much higher monthly payment than a loan of 60 months.

“[Loan] funds can also be used for installation, landscaping, or anything else related to a hot tub installation such as a platform/deck, enclosure, surround sound, and lighting,” says Todd Nelson, business development officer at LightStream.

Option 4: Financing Hot Tubs with Credit Cards

Most credit card companies offer cards that come with a 0% APR promotion. Depending on the card, you could get up to 21 months to pay off a large purchase with no interest. Some credit cards with slightly shorter 0% APR promotional periods may provide rewards on your big purchase.

Because your credit limit on a 0% APR credit card may be limited, using one is a great solution if your hot tub is on the cheaper end. Be sure to compare top credit card options to find out which is best for you and take advantage of one of these promotional offers today.

Hot tub types and financing

The cost of a hot tub varies significantly based on type of hot tub you buy. There are options for all spaces, lifestyles, and budgets. There are small tubs that fit only two to three people; then there are the large eight-person tubs with all the bells and whistles.

The cost of your hot tub can play a role in determining which financing option is best. You may be able to finance an inexpensive hot tub with a credit card — ideally one with a 0% APR intro offer — but not everyone will have the credit limit to purchase a high-end hot tub with plastic. Depending on the one you choose and how much cash you have on hand, you have four options to pay for your hot tub. We’ve included a variety of options here to ensure that the price of a hot tub doesn’t prevent you from owning one.

Ongoing Maintenance Costs

In order to keep your new hot tub in optimal working condition, you’ll need to maintain it regularly. Cleaning costs, parts and labor for any broken pieces, and utility costs are all part of keeping your hot tub looking and feeling as great as the day you first had it installed. Although maintenance costs are not part of the financing a hot tub, it’s a good idea to calculate and consider the cost of maintenance expenses before you decide to purchase one.

Next steps

As you’re searching for the right hot tub, be sure to compare multiple contractors and hot tub brands at your local dealer to find the best fit. When it comes to the hot tub, you don’t necessarily need to pay more for a high-end spa. Similar models with the same features are often available for a lower cost, with installation included. So, be sure to compare several options before deciding on one.

When it comes time to finance your new hot tub, carefully review each option to find the best one for you. Before you choose, consider using SuperMoney’s loan offer engine to see what kind of offers you can get. The engine allows you to check what rates and terms you prequalify for without hurting your credit.