As we already understand, a home renovation loan is considered to make beauty changes to your existing property. Home Improvement Loans are smaller loans for fitment to smaller needs. This type of loan pretty much covers your house improvement treatment, whether with a new piece of construction, newer interiors, or overhauling of the existing property for better. The topic of this article can confuse a few, therefore it’s good to clarify straight away. So here, do we mean taking a home improvement loan against the property which has already been mortgaged, or is it planning to take a home improvement loan of this mortgaged property?
The following possibilities can be underlined as an outcome of our understanding:
- First and foremost, if you’re to take a loan against the mortgaged property, then it’s almost impossible. The reason being you do not have the property papers with you. The best you can do is to ask your existing lender to top up your loan for home improvement. But approaching a new lender is just not plausible.
- Second, in line, you can opt for a home improvement loan from your existing bank or the new lender against the property and use the same money for home improvement.
- Last but not the least, if you have a home loan and the existing lender refuses for a top-up. You can easily get your home loan balance transferred to another lender and have your loan refinanced with an additional top-up loan facility available in the scheme.
What are the different types of Home Improvement Loan in India?
Home renovation loans are not that difficult. If you have If different loans to your kitty already, then it’s easier to have a home renovation loan. This is possible only if your credit history is manageable. There are multiple ways to get a home improvement loan from different financial institutions. Some of the different types of home improvement loans are as shown below:
- Personal Loan: To make significant changes to your house, you can choose a personal loan for home renovation. This is comparatively easy to apply compared to loan types. However, this weighs heavier, cost-wise. In most cases, a sizeable home renovation loan requires collateral security (your house) against the lent money. It is a deficit deal for the borrower to mortgage an item of higher value is compared to a fixed principal amount. Once your house is blocked as security, taking no other loan is possible after.
- Top-up Loans: If you’re unsure of taking bigger complex loans, then try a top-up loan. It is easily available at an instant need. These loans are also suitable for ad-hoc needs and small value items. This is lent to you by your existing lender in addition to your major loans.
- Gold Loan: There’s another choice for you in the financial market. Gold loans can be an attractive option if your credit history and score are standing tall. If the cost of renovation you desire is pretty moderate, then gold loans can be extremely helpful. Gold loans are suitable for reasonably measured Home Improvement Loans.
Read to know more about How to Get a Personal Loan for Home Renovation?
