Why Is A Top Up Loan A Good Idea For You?
Are you wondering how to raise money for refurbishing your home? Or do you need affordable financing to fund your child’s education? No matter what you need money for, if you already have a home loan, a top up loan can help combat your financial worries.
A home loan top up is available at low interest rates and is the best source of finance for existing home loan borrowers or those looking to do a home loan balance transfer. You can use this loan for a range of purposes like financing a home renovation, purchasing an asset like a vehicle, upgrading your household appliances and electronics, financing your children’s education or funding a wedding. One of the primary benefits of a top up is that it doesn’t require you to go through any lengthy application procedures. Another advantage of a top up loan is that it offers much lower interest rates as compared to other loans available in the market.
An Insider’s Look At Top Up Loans
Top up loans can be defined as a loan that is borrowed over and above a home loan; hence, it is referred to as a top up loan. Lenders offer this facility exclusively to home loan borrowers. This is because after purchasing a home, a home owner is sure to incur numerous other costs, and if a lender is satisfied with their ability to repay the new loan, they are offered a top up. You can usually apply for a top up loan from 6 months to 1 year from when you first take a home loan or immediately when you transfer your home loan to a new lender. This is because a lender analyses your ability to repay the top up loan alongside your home loan. After seeing whether your EMIs have been timely and consistent and studying your income statement, a lender will offer you a top up. You can also approach your lender to ask for a top up. In the case of balance transfers, a top up loan is one of the many benefits a lender offers you for refinancing your home loan.
What Makes Top Up Loans A Winner?
There are numerous reasons why you should apply for this loan. From low interest rates to easy and quick application, top up loans offer you everything you need. Here are some benefits of top up loans:
- Simple Eligibility: These loans do not have rigid eligibility criteria that are tough to match up to. Since most of the eligibility documents are submitted at the time of borrowing the home loan, you don’t require too much more documentation at the time of availing a top up loan. All you have to do is get in touch with your lender and request for a top up loan Your lender will then do the needful.
- Quick and Instant Application: This type of loan doesn’t require you to go through the whole hassle of an application process. If you have a good repayment history on your home loan and show that your earnings are capable to paying off a new loan, your lender will disburse your top up loan to you almost instantly.
- Affordable Interest Rates: Top up loans have interest rates that range from 8% to 12%. These rates are much lower than the interest rates for other loans. Hence, a top up loan is much more convenient, affordable and beneficial for the borrower.
- Convenient Tenor: The tenor for these loans are usually the same as the repayment duration left over on your home loan. This makes it more convenient for you to manage your EMIs and pay them in an organised fashion. Also, if your home loan tenor is a long one, your EMIs for the top up loan would be spread across a longer term and hence its EMIs will put less of a financial burden on you.
- No Additional Collateral or Guarantee: Top up loans do not require you to submit any additional collateral as security or even have a guarantor. This makes them much more convenient.
- Tax Exemption: If you use your top up loan for buying or constructing new residential property, then you will save tax. You can get tax benefits on the principal repayment of your top up loan under Section 80C and for your interest payment under Section 24. If you use the amount for home repair or adding a feature to your property, you will be eligible to save tax on your interest payment under Section 24.
If you already have a home loan, and have a reason to borrow funds, for home-related expenses or otherwise, get a convenient and affordable top up loan today! Apply now for a top up loan from Bajaj Finserv and find out the many advantages it offers you.