Comparing Top Up Loan vs. Personal Loan for Home Renovation
In this busy world, home is the only respite. So it is essential to have your home renovated from time to time to suit your mood and thoughts. While the home renovation can be a little expensive, you can always opt for the credit from a reputed bank or NBFC.
There are two available home renovation loan options: top-up on your existing loan or a new personal loan. In this article, we will discuss what both are, and which is the better option.
Comparing the Two Loan Options
The best way to resolve confusion is to compare the two and then make an inference.
Loan terms: The loan terms include the loan interest rate, tenure, and loan amount. You can use an online home loan and personal loan calculator. For both top-up and personal loans, the loan terms remain the same.
Collateral: No collateral or security is required for a personal loan, but if you are looking to top-up the existing loan, then you will have to submit existing property documents as security.
Tax Benefits: Personal loan does not offer any tax benefits. However, in some circumstances, if the amount is borrowed for home renovation, you can avail of tax benefits. However, the loan top-up does not provide any tax benefits.
Documentation: The approval process and documentation for a top-up loan are much more straightforward than personal loans.
While there is not much difference between the two, loan options' preference depends on your requirements and loan eligibility. You must thoroughly compare various loan options online before choosing one.
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