There are lots of different ways to pay for home improvements, but some methods are more conventional than others. When most people think about financing their home improvements they often consider traditional means of borrowing money such as going to a bank for a secured home improvement loan or using a low interest home improvement credit card.

If, however, your financial situation doesn’t allow you to apply for those sorts of loans, and your home needs some sort of repair to keep it safe then you may want to consider a “good neighbor” home improvement loan.

Neighborhood loans for home improvements have been becoming more common as home prices fall people have lost most of the equity they have in their homes. The concept is simple: people helping people fix up their homes, either with direct help or by providing indirect support such as food or something else for trade.

Here’s a practical example of how a neighborhood home improvement loan would work: Let’s say you’re an elderly woman who needs to repair a leaky roof and maybe have some of your front landscaping thinned out. Instead of going to a bank or lending institution to try to borrow the thousands of dollars needed for these home improvements you could turn to some neighbors who may know how to repair the shingles on a roof and some able bodies who can tear out some bushes. In return for this service you might be able to offer some home cooked meals, knit a blanket or afghan or even offer to do some home cleaning for the people who are offering to help you.

If you don’t have any neighbors with the skills needed to improve your home, there is another way you can still finance your home improvements. You can offer to take out a personal loan from your neighbors and in return you can pay back the loan at a small interest rate, much lower than what a bank might charge. In this situation your neighbors get to make a little extra money with the interest charged and you get to improve your home at a much cheaper rate than what a traditional lending institution might charge. To be sure everything stays friendly, you should definitely speak with an attorney and probably have a written agreement drawn up.

This neighborhood home improvement loan is simply a smaller, and more local, version of what Lending Club is actually doing : sign up is free and easy, loan applications are quick and online and the interest rates are lower than most banks. You can read more about using LendingClub.com for a home improvement loan and see if the it’s for you. It’s essentially an internet version of a neighborhood loan. It’s people lending money to other people at a low interest rate.

Of course, when everyone in a neighborhood pitches in an helps another neighbor improve his or her home, everyong benefits. The nicer and more updated each home in the neighborhood is, the more everyone’s home is worth. By raising the value of one home, you in effect increase the value of all homes in the entire neighborhood. So loaning your neighbor help or money to update his or her home is actually like giving yourself a loan as well!