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Top lenders are now extending home renovation loans at competitive rates.
If you’re looking to refurnish your home to update to your comfort, a home renovation loan is a smart way to finance the project. After all, aesthetics and comfort are also related to factors like construction and location.
A customer who has already benefited from a home loan can again take a home extension loan from the same lender as an additional facility to an active loan.
Paperless loans are easy to avail of, have a quick sanction, personal loan rates are competitive and do not need any collateral.
To understand better home renovation loans, let us have a look at the simple four tips.
Eligibility parameters and documentation
- Home Renovation Loans feature certain eligibility parameters, with lender-specific qualifying factors, such as:
- The applicant’s age must be between 21-67 years
- The applicant has to be a salaried employee in a reputed MNC or private organization
- Those persons applying for home renovation loans must have a CIBIL score of over 750
- They need to provide KYC documents, salary slips for the previous three months, bank statements for the last three months, and employee ID card
Applicants can also opt for a paperless loan from reputed financial institutions with no collateral and minimum documentation. Borrowers need to pay off all the existing debts on time to improve loan eligibility.
One who successfully meets these requirements can avail of the home renovation loan within a short time.
Determine loan amount
Before thinking about a loan, people have got to cautiously work out the loan amount they require and the interest they have to pay during the loan tenor.
Borrowers can utilize an EMI Calculator to calculate the loan amount he is eligible for as per their profile. He can find out the EMIs, the interest to be paid, and the total amount to be borrowed in advance with the EMI calculator. This way, borrowers can easily select the most appropriate alternative that suits their financial requirements.
Select lender
After finalising the required amount, the next step is to conduct careful research and compare the offerings by different lenders before taking any decision.
One has also to check other features such as loan interest rates and loan tenor as they add value to the borrowing. Leading NBFCs extend pre-approved offers borrowers can avail themselves of quick loans and convenience. Pre-approved offers are based on credit history and connection with the previous lender. Such offers benefit swift and minimal paperwork.
Borrowing cost
Borrowers need to look beyond interest rates when applying for House Improvement Loans, as the additional costs should not be a burden at the later stage of the loan tenor.
It would be wise to ensure that the lender is transparent regarding processing fees, part-prepayment and foreclosure charges, EMI bounce charges, penal interest charges and more.
Under Section 24 of the Indian Income Tax Act, 1961, House Improvement Loans makes available tax benefits on the interest element. You can take the benefit of a deduction of up to Rs. 30,000 per annum.
Conclusion
Considering these factors while applying for House Improvement Loans, individuals can effectively fulfill their dreams of home renovations without straining their life savings. One has to meet stringent eligibility criteria to avail of the loan. You can use the loan for a range of activities like repairs, flooring, extension, and painting your complete house. However, you cannot make use of the loan for buying furniture, fixtures or furnishings.
For an affordable and smooth, comfortable experience, you can get in touch with leading NBFCs. They offer a Flexi Loan facility with a tenor from 24 to 60 months. The interest rates are competitive to help you keep the EMI under control.
Author Bio: Arwind is a passionate financial blogger and financial adviser. He has been serving society as a financial adviser for the past 6 years. He shares his financial tips and tricks on Loantrivia. He has an amazing solution for every finance-related query.
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