The expenses associated with moving into a new home are almost endless. Very often, it happens that a Home Loan availed for such expenses cannot fulfil all the financial needs. In this regard, there is no better solution than a top-up loan. These additional loans are quite easy to avail when you already have a Home Loan with a particular lending institution. This is because eligibility hassles become lesser with an existing Home Loan, and after 6-12 months of repayment, you can qualify for a Top-up Loan without too much effort.
Proceeds of a Top-up Loan can be used for a number of purposes. They can be used for the following purposes:
Home renovations and remodelling
Buying new furniture for the new home
Replacing old furnishings like curtains
Adding new or replacing old kitchen fixtures
Replacement of bathroom fixtures
Top-up loans can be availed without the involvement of any security, collateral or mortgage- this further reduces documentation troubles which could otherwise slow down the entire process of setting up your new home.
Being a debt instrument, these loans too have to be repaid in full and on time in order to avoid any ill effects on your credit score. That being said, you also become eligible for increased tax benefits as specified in the Income Tax Act as your overall liability increases when you opt for a top-up loan.