Home Improvement Loan Vs Top-up Loan

Home loan is a crucial one when you go for your dream home.

It is always important to beautify your home to add more happiness. For such kind of necessities, you need to work on your financials again after paying the down payment and after you start your EMI for your home loan. Home Improvement Loan is one such loan to fulfill all your needs.

The interiors of your house reflect your personality and to constantly upgrade it in terms of looks and convenience, all the banks and housing finance companies provide Home Improvement Loan.

Home Improvement Loan covers-

  • Complete renovation of already owned residential property
  • Upgradation
  • Repair of your house/flat
  • External & internal repairs/paint
  • Water-proofing & roofing
  • Tiling and flooring
  • Plumbing & electrical work
  • False ceiling & woodwork (fixed to the building)

What you should know about Home Improvement Loan :

  • The rate of interest usually is same as for home loan.
  • 80% of the property value is the maximum amount valid for home improvement loan.
  • Repayment period is same as for home loan.
  • You can repay the loan even before the tenure but check for repayment fees.
  • You can claim tax deduction when you are in home improvement loan. Both the co-borrowers can claim deduction.
  • Banks do not provide home improvement loan for a property which is older than 35 years.
  • Pay processing fees.

There is also an extensive range of home loan products like Home Purchase Loans, Home Construction Loans, Home Extension Loans, Home Improvement Loans and Plot Loans.

One will always think of top-up loan when in need of money.  Top-up loan is used when there is an immediate financial need. It is always recommended to go for a top-up loan if you are already in a home loan.

Everybody aims for a higher growth. For the steps to go forward in life, you might need a lump-some cash anytime. For such reasons exists, top-up loan on home loan.

Top-up Loan covers :

  • House renovation
  • Medical
  • Marriage
  • Education
  • New investment
  • To repay any other debt

What you should know about top-up loan : 

  • You can avail top-up loan only if you have an existing home loan.
  • The rate of interest usually is 0.5% – 1.00% more than the home loan interest rate.
  • 80% of the property value is the maximum amount valid for top-up loan.
  • The eligibility is based on your credibility and other loans.
  • Repayment period is same as for home loan.
  • You can repay the loan even before the tenure but check for repayment fees.
  • You can claim tax deduction when you are in home improvement loan. Both the co-borrowers can claim deduction.
  • Need to pay processing fees.

Everything is similar when you compare home improvement loan and top-up loan. If you have to choose one, give yourself the ratings for both the loan types based on the interest rate. Also, if you foresee any future financial necessity other than home renovation, it is better go for a home improvement loan when you are in need of any home remodeling.

Loanyantra helps you build the bridge between you and banks/financial institutes. To get a hassle-free guidance and home loan help, we are just a missed call away. Plan your loan well and close it early. Invest more and earn more.

 

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