If you’re considering finishing your basement, you may be wondering what are some ways to pay for finishing a basement.

It’s good to have some sort of an idea before you call any basement contractors to start gathering some quotes.

Here are some popular options to pay for finishing your basement:

Pay for a Basement with Cash

Maybe you’ve been listening to some Dave Ramsey and love paying for things outright. Or you possibly came upon a small inheritance unknowingly (I know of people this has happened to).

Paying for your basement with cash (or check) is the best option if you can swing it. Nothing stands in the way of getting started and you have complete control over how the money is allocated.

Plus, you may have some bargaining power with your basement company if they know that to be the case.

Pay for a Basement with a Home Equity Line of Credit (HELOC)

A HELOC is a line of credit approved by a bank that is secured by your home. These types of loans are often used for larger expenses such a basement remodeling or basement finishing.

The HELOC borrows money against the equity of your home which means your home’s worth is the collateral. Much like a credit card, the money can be replenished when you re-pay back the funds.

This is a popular option for lots of homeowners because the interest rate is often lower than other loans and in many cases, the interest is tax deductible. Here are some conditions for tax deductions, though:

  1. You have to itemize. This would mean that you have greater than 24K in itemized deductions for 2018 (with only 10K max towards state taxes paid — property and income tax).
  2. You are limited to 750K of qualified residence loans. So if your mortgage and your HELOC are greater than 750K, the amount you can deduct will be limited.
  3. The HELOC cannot be used to pay for personal expenses (ex. To pay off student loans or credit cards).

Once the project is complete, you’ll start making payments back on the line of credit- usually 20 years.

Pay for a Basement with a Credit Card

This is probably one of the least recommended ways to pay for a basement for a couple of reasons:

  1. The interest is really high on a credit card negating any “points” benefit you may receive in return.
  2. Many basement contractors in Omaha (or in general) don’t accept credit cards.

Listen, we know you want the points and you’re so used to putting most of your transactions on plastic.

When it comes to high-dollar items such as a basement finishing project, very few contractors will want to eat the cost of the credit card fees. As such, many won’t accept it. If you intend to pay this way, make sure your basement contractors gives you the thumbs up before proceeding.

Other Financing

Have some cash stashed away in a shoe box buried in your backyard? This may work!

Or perhaps you have a generous family member that will loan you money for the project? That may work, too!

Have a few high asset items that you can sell? That’s an option!

There are plenty of ways to personally finance finishing your basement or remodeling your basement.


At Hawthorne Finished Basements, we can help work with homeowners to understand the costs of basement finishing or remodeling.

Additionally, we have preferred partnerships with area Omaha banks to help homeowners our clients get the best deal.

To get started on your basement remodeling project, give us a call at (402) 321-5260 or email hello@hawthornebasements.com.