All you need to know about top-up loans on Home Loans
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All you need to know about top-up loans on Home Loans

  • Highlights

  • Top up loans have an easy application process

  • You can get tax benefit on top-up loans

  • You don’t have to submit any additional collateral

  • Having a good repayment history is essential

With easier availability of loans, you can now address your financial needs without hassle. However, some loans come with a higher rate of interest and may end up straining your finances in the long run. Hence, it’s better to opt for top up loans if you are carrying out a home loan balance transfer.

They are easy to apply for and charge a much lower rate of interest.

What is a top up loan?

You can apply for a top up loan when you do a home loan balance transfer.
The criteria for getting a top up loan is simple:
timely repayment of your home loan EMIs.
Financial institutions will consider your top up loan application if you have a good repayment history.

What are the benefits of a top up loan?

When you have monetary needs while also repaying your home loan, a top up loan is a convenient source of finances. Here are the benefits of a top up loan:
• If you avail a top up loan when you opt for a home loan balance transfer, the documentation process is minimal and the loan disbursement process is faster. Additionally, Bajaj Finserv allows you to apply for a top up loan online, which is approved within a couple of minutes.
• When you’re applying for a top up loan, you don’t have to disclose the purpose for doing so. You can use it for any personal expenses like funding a home renovation or a vacation.
• But, if you invest the loan amount towards home improvement, then you can claim a tax deduction on the interest paid under Section 24 of the Income Tax Act.
• Another benefit of taking a top up loan is that you can use the money from it to close existing unsecured debts. These debts may have high interest rates and so, if you want to save some money, clear your debt with the help of a top up loan.
If your existing Home Loan has a high rate of interest, all the more reason to lower it by opting for a Home Loan Balance Transfer.

Tips to Improve Home Loan Eligibility

What are the benefits of a top up loan?

Since your top up loan is an add-on to the home loan balance you have transferred, you don’t have to submit any additional collateral. But, failure to pay instalments of this loan on time has a similar outcome as defaulting on home loan payments.

that you know how convenient getting a top up loan is, don’t hesitate to take the plunge when you face a financial crunch.

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