Even with exquisite interiors, your perfectly designed fireplace may not feel as ‘complete’ without a couch or ottoman to compliment it. Furniture adds gravitas to your home while giving you a comfortable and often luxurious space to unwind. But furniture shopping can be a tad bit expensive on your wallet, especially if you’re moving into or re-doing a completely unfurnished home.

With furniture loans, you can spread the cost of your furniture purchase into fixed and affordable monthly instalments across several months. Furniture loans are essentially unsecured home improvement loans that enable you to pay for your furniture purchase upfront. You can choose a loan term and amount that aligns with your financial circumstances, giving you more control over your repayments.

Furniture finance, fundamentally, means using credit to pay for your furniture purchase. You can repay this credit through manageable monthly instalments, depending on the term you choose for your loan. You can typically borrow from £1,000 to £35,000 to purchase household or office furniture over 12-84 months.

When you apply for a home improvement loan for furniture finance, lenders usually assess your application based on your credit score, financial circumstances and employment status. Evaluating this information helps them gauge your repayment ability and risk proposition in lending money to you.

Where a stellar credit history fetches you competitive interest rates, a low credit score can lower your chances of securing credit at an enticing rate. Therefore, working to improve your credit score before applying for a loan favours you in the long run.

Once you successfully secure the loan after a complicated credit assessment, the lender will directly transfer the funds into your bank account. You can then use the money to pay for your furniture purchase upfront. While you can use the funds at your discretion, you should use them responsibly – failing to keep up with your loan’s repayments can damage your credit score. In the worst case, you may even get a County Court Judgment (CCJ) through your lender, which can hamper your chances of securing credit in the future.

There are many ways to use a home improvement loan for furniture finance:

⦁ Use it for sofa finance or to buy sofas on credit.
⦁ Use it for bedroom furniture finance.
⦁ Use to re-construct your old furniture (materials, workers, etc.).
⦁ Use it to finance office furniture.
⦁ Use it to buy furniture for a rented home (as a tenant or owner).

Purchasing furniture can be expensive, and there’s a lot that you will need to consider before making a decision. Start your research here:

Is it wise to purchase bedroom furniture on finance? Beds and mattresses can be expensive. Using your savings to pay upfront may not be the most innovative option, especially when you’re moving in with your partner or starting a new chapter of your life in a different city. Set your savings aside for a better, more crucial purpose. Split your expense into easy instalments with furniture loans. 

Can I buy used sofas on credit?

Several stores offer used goods such as sofas, mattresses, bed frames, and cupboards for sale. While you can borrow used sofas on credit, some stores may prefer an upfront payment for used goods. Some stores might also offer a discount to those who can pay the cost upfront. In such cases, it makes more sense to use funds from a furniture loan and take advantage of the various discount schemes. Ensure that you thoroughly check the quality of items before completing the purchase.

What will be the repayment implications on furniture finance?

Like any other form of credit, furniture loans also have severe repayment implications. Missing repayments on your furniture loan could be detrimental to your credit score. Suppose your missed payments amount to a default. In that case, you will likely receive a CCJ from the court, Further impeding your chances of qualifying for low-interest loans. 

Are there any regulations that I need to keep in mind?

There are no building regulations regarding furniture purchase or placement since most furniture that we use isn’t bolted to the walls or the floor. At best, you could notify your neighbours about the bolting or construction work taking place in your premises if the work gets unbearably noisy. 

Here’s what you can use to finance your household furniture:

⦁ Home Improvement Loans for Furniture Finance: Unsecured loans are a convenient way to break down the cost of your purchase into affordable monthly instalments. You can borrow a significantly higher amount with home improvement loans, enabling you to pay upfront and snagging in-store discounts on both new and used furniture.

⦁ Credit Cards: Using a credit card to purchase your furniture could affect your credit utilization ratio if the payment exceeds 30% of your credit limit. In turn, this could lower your credit score. Furthermore, credit cards and bank overdrafts may have higher interest rates than unsecured personal loans. 

⦁ In-store Financing: With in-store financing, you can apply for credit at the furniture store itself. However, to truly benefit from the discounts, it would be in your best interest to settle your loan within the zero-interest promotional period to avoid paying excessive interest that applies after the promotional period expires.  

⦁ Rent-to-Own: A rent-to-own store allows you to take the furniture home and pay for it in monthly instalments. Renting furniture differs from traditional financing in that consumers can return the furniture to the store for free at any time, provided that the item has not suffered damage. The retailer, however, may repossess the furniture if the customer fails to pay.