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Whether you plan to take on a minor remodeling project or overhaul your whole house in the coming year, you’re not alone.

According to researchers at the Joint Center for Housing Studies of Harvard University, national spending on home improvements and repairs by homeowners is projected to reach $324 billion over the next year.

A May study by Hearth, a financial technology start-up that provides support for homeowners making renovation decisions, found that 12 percent of Americans planned to finance their renovation with a credit card, which is one of the most expensive ways to finance the cost.

The Hearth Home Renovation Survey, which asked 2,000 homeowners about their remodeling plans for the coming year, found the number of people planning to use a credit card to pay for their renovation is even higher in the Washington region at 16 percent.

In this region, 52 percent of homeowners prefer to pay with savings or cash, compared with 62 percent nationally. D.C.-area residents are also more likely to finance their project with a loan — 32 percent — compared with 26 percent nationally.

The survey found that both nationally and in the D.C. area, about one-third of homeowners worry they won’t be able to afford their renovations. In the D.C. area, 11 percent of homeowners surveyed said they never borrow money.

Twenty seven percent of D.C.-region homeowners who do need to borrow money to pay for repairs and improvements said they usually opt for bank loans; 18 percent prefer to borrow from credit unions; 18 percent take out personal loans; 13 percent use credit cards; 10 percent borrow from family members; and 3 percent opt for peer-lending providers such as Lending Club or Prosper.

Typically, credit cards carry the highest interest rates among the various options for paying for home improvements. Home equity loans and lines of credit are common ways to pay for renovations, but if a homeowner cannot repay the loan they run the risk of losing their home in a foreclosure.

The Hearth loan calculator available here can help homeowners evaluate various financing options for their renovation projects.

Homeowners can also use Web and mobile apps such as Buildshop to plan and organize their renovation projects and budget for them. Buildshop also connects homeowners with contractors. The financial tool helps homeowners budget for a project and then use expense trackers to log and control spending once a project has begun.

The full Hearth study results are available by clicking here.

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