If you’re planning to borrow against the value of your home to finance a major remodeling project anytime soon, you might be in for a shock. Even if you have a stellar credit record, you could face far more scrutiny than you would have in years past, especially if you live where home prices are falling.

The reasons? Declining home values and troubles in the nation’s subprime mortgage market. In the past year, as adjustable mortgage rates have risen, more overstretched borrowers have seen their homes forced into foreclosure. Some lenders have responded by tightening their standards for all borrowers, from the least creditworthy to the most.

A couple of years ago, it wasn’t all that unusual to borrow, say, 90 percent of your home equity for a large renovation, notes Charles DiPino, president of the Maryland Association of Mortgage Brokers, who has been in the mortgage business for 15 years. “When values were rising at 15 to 20 percent a year, it was no problem,” he says. “Now that we’re in a flat or declining real-estate market, lenders won’t assume the same risk.”

With home prices dropping, a lender might also be more strict when evaluating your home’s market value, says Michael Knight, CEO of Vanguard Mortgage and Title in Littleton, Colo., which owns mortgage companies in 18 states. Before granting you a loan, some lenders will now ask for a second appraisal. “We’re seeing an extremely tight environment in appraisals,” Knight says. “They’re questioning the value of the home and also the credit score of the borrower.”

Weakening home prices might also make you want to reconsider the scope of your remodeling. Because many projects fail to recoup their costs even in a rising market, it makes little sense to remodel in hopes of boosting a home’s value. The best reason is to make the home more livable and enjoyable for your family.

That said, bankers and brokers insist there’s still plenty of competition for creditworthy borrowers, especially if you’ve built up a significant amount of equity in your home. And the rates on loans, while rising, remain historically low.

If you decide to go loan shopping in today’s tougher marketplace, these will be some of your borrowing options:

Home-equity line of credit (HELOC). This type of financing is best if you plan to do several projects over a number of years. As with a credit card, you borrow only what you want to, making interest and principal payments once you start accumulating a balance. The interest rate is variable and generally based on the prime rate plus a quarter to a half of a percentage point. Interest payments on home-equity loans and mortgages totaling up to $1 million are tax-deductible if the debt is used to buy, build, or improve a principal residence or second home. According to HSH Associates, a publisher of financial information, the average closing fee charged for HELOCs is about $50. Some lenders also make you pay a maintenance fee, typically about $50 a year, if you don’t keep an outstanding balance. Those credit lines typically remain open for 10 years.

Home-equity loan. This is generally your best loan option for a one-time remodeling project. Like the HELOC, this loan is secured by your home’s equity. However, the amount you borrow and the interest rate you’ll pay are fixed at the outset. You might have to pay closing costs, which collectively can run $1,000 or so. Home-equity loans typically last from 5 to 30 years and their interest rates are usually a bit higher than those on lines of credit. In recent months, however, the opposite has been true, making loans more attractive.

Home-center project cards. The Home Depot and Lowe’s both offer these cards for purchases at their stores. Currently, the cards carry a 0 percent rate for six months after the first purchase. Then the interest rate rises to between 8 and 18 percent. Both cards require a first purchase of $1,000 or more but have no set maximum. The Lowe’s card also lets you take additional loans without reapplying for credit. If you’re confident you can pay it off within the six-month window, one of these cards could be a worthy option. Otherwise, they can be a very expensive way to finance a renovation.

Cash-out refinancing. This is an option for big projects on homes with a lot of built-up equity. You take out a new first mortgage, pay off your current one, and use the leftover cash for your renovation. Say you owe $200,000 on a house that’s now worth $300,000. You refinance for $250,000, pay off the $200,000 mortgage, and use the remaining $50,000 for remodeling. One benefit of this approach is a longer payback period--30 years, for example, vs. 10 for a HELOC. Currently, a new, 30-year fixed-rate first mortgage is averaging a bit more than 6 percent nationwide, lower than the rates for HELOCs or home-equity loans. But note that you might have to pay thousands of dollars more in closing costs. And by extending the term of your mortgage, you could pay much more interest over time.

Credit cards. Using a credit card is a reasonable choice when your project will cost no more than a few thousand dollars and you are certain you can pay it back right away. If not, a home-equity line of credit is a better deal.

401(k) loan. Your employer might let you borrow from your 401(k) plan. The major downside is that you’ll be reducing, at least temporarily, your tax-deferred retirement savings. Note, too, that you must pay off the loan almost immediately if you leave your job, voluntarily or otherwise.