Renovation vs. Home vs. Personal Loans In Singapore

With the anticipated steady increase in demand for both public and private residential properties in Singapore, the need for home renovations is likely to rise and selecting the optimal home loans, renovation loans, or personal loans for home purchases becomes pivotal for cost-effective and efficient home improvement.

Whether you're planning to acquire a BTO/resale HDB flat, condominium, or private property, evaluating competitive interest rates, flexible repayment terms, and swift approval processes is essential. Here are some insights to help you identify the differences between home loans, renovation loans, and personal loans for home improvement plans, along with tips for making the right choice.
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Is A Home Renovation Loan Different From A Home Loan Or Personal Loan?

A home renovation loan in Singapore is distinct from a home loan or a personal loan in several key ways and there are other aspects or assets which are included and valid in a home loan or a personal loan which a home renovation loan cannot or do not provide for.

Scope of use

As the term suggests, home renovation loans are strictly used for renovation-related expenses. This includes structural works like flooring, electrical works, painting, and built-in cabinetry but does not extend to non-structural or decorative elements. This is unlike home loans which are primarily for purchasing property, covering the cost of buying a house but does not extend to any renovation or decoration costs that might be incurred after purchase.

On the other hand, personal loans are highly flexible in terms of usage and can be used for anything from debt consolidation, medical expenses, travel, or even home renovations. However, unlike a specific renovation loan, it might not offer the same favourable terms (like lower interest rates) for renovation purposes.

Assets and collaterals

Home renovations loans are generally unsecured, meaning it doesn’t require an asset as collateral, while home loans are often secured against the property being purchased, which means the property itself is used as collateral to secure the loan. As for personal loans, they are usually unsecured, but secured options are available. Secured personal loans might require collateral like a car, savings accounts, or other assets.

Loan amount, tenure and interest rate

Home renovation loans are limited in terms of maximum amount (e.g. 6 times monthly income or a cap of S$30,000) and shorter tenure, but mortgage loans definitely allow higher loan amounts to cover property costs and encompass longer repayment periods. Personal loans give more flexibility in this aspect and are variable in terms of both amount and tenure, depending on the lender and the borrower's creditworthiness.

When it comes to interest rates, there are some personal loans like UOB, Standard Chartered CashOne, GXS FlexiLoan which offer much lower interest rates (lower than 3% as of the latest rates published on 18 January 2024) than most renovation loans and home loans.

Excluded expenses

As briefly shared in the above table, most home renovation loans cannot be used for purchasing movable furnishings or appliances like sofas, beds, refrigerators, or decorative items such as curtains and light fixtures. Similarly, home loans do have exclusions and do not cover any post-purchase costs like renovations, repairs, or interior decoration. With personal loans, there are usually no specific exclusions in terms of usage, but the broader nature doesn't come with the benefits of a specialised loan like lower interest rates for specific purposes.

Disbursement process

For home renovation loans, funds are typically paid directly to the contractors, but for home loans, the loan amount is disbursed to the property seller or developer. The disbursement process for a personal loan differs from both home renovation loans and home loans as the borrower receives the funds directly and has the discretion to use them as needed.
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Which Loan Is Best For My Renovations?

Selecting the most suitable type of loan for your home’s renovation really depends on several factors such as interest rates, purpose of borrowing, financial capacity to repay the loan in a certain amount of time, and many other considerations. As every borrower’s financial needs differ, thus there’s no definite answer (that suits everyone) to this. 


To determine which is better for you, you may refer to our article here, which highlights some of the important factors to note. Here's our quick round-up of the best 5 loans which you may consider for your home renovations.

Best Personal Loans in Singapore (2025)

MoneySmart Exclusive
LOWEST INTEREST RATES | FASTER FULFILMENT
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MoneySmart Exclusive
LOWEST INTEREST RATES | FASTER FULFILMENT

Standard Chartered CashOne

Interest Rate
From 0.90% p.a.
Total Amount Payable
S$10,090
Processing Fee
S$0
Per Month
S$841

Sign up via MoneySmart and claim:
Up to S$5,725 Cash OR 19,050 SmartPoints (enough to redeem Apple iPhone 17 Pro Max and more) T&Cs apply.

 

Bonus promotion:
- Up to 1.61% cashback of your loan amount 
- Only applicable to loans over S$18,000 with a 3 to 5 year tenure
- New-to-card and new-to-loan customers only
T&Cs apply.

Valid until 31 Aug 2026
Apply Now
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MoneySmart Exclusive
FLASH DEAL | UP TO S$1,700 CASH REWARDS!
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MoneySmart Exclusive
FLASH DEAL | UP TO S$1,700 CASH REWARDS!

UOB Personal Loan

Interest Rate*
From 1.00% p.a.
Total Amount Payable
S$10,100
Processing Fee
S$0
Per Month
S$842

Sign up via MoneySmart and claim:
Up to S$1,700 Cash via PayNow OR 19,050 SmartPoints (enough to redeem an Apple iPhone 17 Pro Max and more)

 

And get your rewards in as fast as 4 weeks!
T&Cs apply.

Valid until 26 Aug 2026
Apply Now
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MoneySmart Exclusive
RICHEST OFFER
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MoneySmart Exclusive
RICHEST OFFER

CIMB Personal Loan

Interest Rate
From 1.00% p.a.
Total Amount Payable
S$10,100
Processing Fee
S$0
Per Month
S$842

Sign up via MoneySmart and claim:
Up to S$1,200 Cash via PayNow OR 14,335 SmartPoints (enough to redeem Apple iPhone 17 and more) 

 

T&Cs apply.

Valid until 14 Aug 2026
Apply Now
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MoneySmart Exclusive
LOAN APPROVAL IN 60 SECONDS!
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MoneySmart Exclusive
LOAN APPROVAL IN 60 SECONDS!

Trust Instant Loan

Interest Rate*
From 1.00% p.a.
Total Amount Payable
S$10,100
Processing Fee
S$0
Per Month
S$842

Sign up via MoneySmart and claim:
Up to S$1,700 Cash via PayNow OR 19,050 SmartPoints (enough to redeem Apple iPhone 17 Pro Max and more) T&Cs apply.

 

Bonus promotion 1:
- Get S$10 FairPrice E-Vouchers (use promo code MONEYSMT)
- New-to-Trust customers only. T&Cs apply.

 

Bonus promotion 2:
- Get up to S$10,000 Cashback Scratch Card
- New-to-Trust & selected Existing customers only. T&Cs apply.

Valid until 31 Aug 2026
Apply Now
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MoneySmart Exclusive
Quick Application via MyInfo, Instant Disbursement
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MoneySmart Exclusive
Quick Application via MyInfo, Instant Disbursement

HSBC Personal Loan

Interest Rate*
From 1.30% p.a.
Total Amount Payable
S$10,130
Processing Fee
S$0
Per Month
S$844
Enjoy attractive interest rates from as low as 1.30% p.a. (EIR from 2.50% p.a.) and zero processing fees* for any loan amount!
Valid until 31 Aug 2026
Apply Now
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Looking for personal loan rates as low as 1.90%?

Head to MoneySmart’s personal loan calculator and comparison tool to figure it all out. All you need to do is input your details and desired loan amount and tenure, and we’ll automatically find the best options for you.
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Best forLoan TypeLoan PackageEstimated interest rate (as of February 2024)
Best forMost types of renovationsLoan TypePersonal loanLoan PackageHSBC Personal LoanEstimated interest rate (as of February 2024) From 4%
Best forLonger tenuresLoan TypeRenovation home loanLoan PackageDBS Renovation LoanEstimated interest rate (as of February 2024) From 4.88%
Best forLow feesLoan TypePersonal loanLoan PackageCIMB Personal LoanEstimated interest rate (as of February 2024) From 3.38%
Best forEco-conscious homeownersLoan TypeMortgage/renovation loanLoan PackageOCBC Eco-Care Home LoanEstimated interest rate (as of February 2024) From 3M Compounded SORA + 0.65%
Best forEco-conscious homeownersLoan TypeRenovation loanLoan PackageMaybank Renovation LoanEstimated interest rate (as of February 2024) From 4.98%

*Estimated data collated above is based on the respective loan package providers’ (DBS, OCBC, HSBC, CIMB) websites and February 2024’s 3M Compounded SORA rates, last updated here on 6 February 2024.

Best Renovation Loans in Singapore

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DBS Eco-aware Renovation Loan

Interest Rate
From 4.88% p.a.
Total Amount Payable
S$10,488
Processing Fee (Approved Loan)
S$200
Per Month
S$874
Apply Now
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MoneySmart Exclusive
Receive Cash in 15 mins! | HIGHEST CASHBACK
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MoneySmart Exclusive
Receive Cash in 15 mins! | HIGHEST CASHBACK

Standard Chartered CashOne

Interest Rate
From 0.90% p.a.
Total Amount Payable
S$10,090
Processing Fee
S$0
Per Month
S$841

Sign up via MoneySmart and claim:
Up to S$5,725 Cash OR 19,050 SmartPoints (enough to redeem Apple iPhone 17 Pro Max and more) T&Cs apply.

 

Bonus promotion:
- Up to 1.61% cashback of your loan amount 
- Only applicable to loans over S$18,000 with a 3 to 5 year tenure
- New-to-card and new-to-loan customers only
T&Cs apply.

Valid until 31 Aug 2026
Apply Now
More Details
MoneySmart Exclusive
Quick Application via MyInfo, Instant Disbursement
More Details
MoneySmart Exclusive
Quick Application via MyInfo, Instant Disbursement

HSBC Personal Loan (For Renovation Needs)

Interest Rate*
From 1.30% p.a.
Total Amount Payable
S$10,130
Processing Fee
S$0
Per Month
S$844
Enjoy attractive interest rates from as low as 1.30% p.a. (EIR from 2.50% p.a.) and zero processing fees* for any loan amount!
Valid until 31 Aug 2026
Apply Now
More Details

Frequently Asked Questions

Can I use a personal loan for my home renovations?

Yes, there are many banks that offer personal loan options which you can sign up or apply for a renovation expenses for your home via your preferred bank, agents or finance platforms like MoneySmart’s Personal Loans comparison tool.

Is a home renovation loan different from a home loan and personal loan?

Yes. A home renovation loan is different in many ways from a home loan or personal in terms of scope of use, assets and collateral, loan amount, tenure and interest rate, excluded expenses, disbursement process. You may refer the above section “Is A Home Renovation Loan Different From A Home Loan Or Personal Loan?” for more details.

Do home renovation loans offer longer tenures?

Yes and no. Home renovation loans are usually shorter tenure loans as compared to mortgage loans which encompass longer repayment periods. When compared with personal loans, home renovation loans offer less flexibility than personal loans as personal loans are more variable in terms of both amount to borrow and the required tenure, depending on the lender and the borrower's creditworthiness.