Factorialist

Top Up Your Existing Home Loan To Fund Your Aspirations

The Top-up Home Loan is becoming a favorite product in the banking industry in recent times. What is a Top- up Home Loan and how is it beneficial than a Personal Loan? Let us explore the reasons.

This example will simplify things for all. You have a Home Loan and are regular in repaying your in stalments. You need some liquid funds to renovate your home, or buy a car, or even fund your child’s education. You have two options. Either you opt for a Personal Loan or Apply for a Home Loan Top Up.

What is a Top-up Home Loan?

As the name suggests, a top-up home loan involves the topping up of the existing Home Loan. Banks, usually do not ask much questions while approving top-up Home Loans because they know your repayment record. If you satisfy the standard eligibility norms, banks are liberal in approving top-up Home Loans.

The difference between a Personal Loan and a Top-upHome Loan –

Apparently, you can see that the Top Up Home Loan is beneficial as compared to the Personal Loan or a Credit Card.

Prime Eligibility Criteria

Interest Rate:

The rate of interest is the primary advantage of a top-uploan. In the normal circumstances, banks charge interest at the Home Loan rate or maybe a percentage point more. In any case, it is much less than what they charge for a Personal Loan.

Benefits of Availing a Top-up Loan

How Do You Apply for a Top-up Home Loan?

Usually, you approach your existing lender for a Top-upHome Loan. The reasons are obvious. Your lender has the title deeds of your property in its possession. It will be easier for you to extend the equitable mortgage to cover the prospective facility than to approach a new lender.

However, there is no problem in approaching a new lender as well. As long as you satisfy the eligibility criteria and maintain a good repayment record, banks adopt a positive approach towards Top-upHome Loans. They might ask for a valuation report of the property in case the current valuation is more than 3 years old. It is to ensure that they maintain the LTV (Loan to Value) ratio at around 70% to 80%.

As a matter of abundant caution, the banks might insist on the production of the encumbrance certificate.

Charges You Have to Incur

Thus, you have seen that a Home Loan Top Up is any day beneficial as compared to other loans. They are not only cheaper but also readily available. Hence, the top-up home loan has become more popular today. You can use this option to fund your aspirations.

Also Read: Keep These Points in Mind if You Are in Your 40s and Applying for a Home Loan

To apply online for Credit Cards, Secured Loans and Unsecured Loans, visit www.mymoneymantra.com, the leading online lending marketplace that offers financial products from 60+ Banks and NBFCs. We have served 2 million+ happy customers since 1989.

Talk to our Loan Specialists toll-free at 1800 103 4004 to know more about our products and offers.

Exit mobile version