A home improvement loan is a personal loan that can be used for renovating or repairing your existing home. If you are planning to make changes in your old home, then you can apply for this loan after verifying your personal loan eligibility criteria. Checking the eligibility criteria is important because it determines whether you are eligible for high or low-interest personal loans. Also, you should be aware of these pros and cons of home improvement loans before applying for one:
Pros
Increases value of the home
A home improvement loan will help you to enhance the value of your home. This means that the interest that you will be repaying to clear the loan will be covered when you sell it.
Makes your home attractive
You can use a home improvement loan to make your home look better than before. You can also change the interiors of your home to provide better living space to your family.
Affordable loan
If your credit score is good, you can request an instant personal loan at an affordable interest rate. This means that you don’t have to pay a high EMI to redefine the look or repair your home.
Cons
Limited amount
An unsecured home improvement loan will provide you a limited loan amount based on your eligibility. To procure a high-value loan you may have to submit your property as collateral. This means that you may lose the property if you fail to repay the loan in time.
High-interest rate
If your credit score is low, then the lender may not offer low-interest personal loans to you. Therefore, you will be forced to get the loan at a high-interest rate. This will lead to an increase in interest outflow and can also affect your finances due to higher EMI. Therefore, you should use a loan EMI calculator before getting the loan.
The lender may even reject your application if you fail to meet the personal loan eligibility criteria. Another option would be to go for pre-approved offers that may include home improvement loans. As these loans are already pre-approved, the chances of loan rejection get minimized and your loan request gets approved instantly. Bajaj Finserv offers pre-approved loans comprising home improvement loans, education loans, travel loans, etc. For checking your eligibility, you only have to provide your name and contact details on their portal.
