A top up loan is an additional credit borrowers can avail over and above an existing home loan.
Individuals wondering what is a home loan top up should know that such a credit is offered over and above the existing home loan of the borrower.
Here is a list of a few top up loan benefits –
Nominal interest
A top up loan is like a personal loan, but the interest charged is much lower. A low interest rate makes it a viable choice for any financial requirements.
Zero documentation
As you are already providing the necessary paperwork for the home loan, no documentation is required to avail a top up loan. This allows for a hassle-free and faster loan processing period.
No additional mortgage
A top up loan on a home loan requires no other mortgage. The borrower can use it for any purpose, as it is considered as a personal loan.
Income tax exemption
If the top up loan is used for home repairs, renovation or construction, homeowners can avail tax exemptions under Section 24(b) on the interest payments.
Paying off debts
One of the many benefits of a top up loan is the facility to pay off any existing unsecured debts that have a high rate of interest. Affordable interest rates charged enables individuals to save a significant amount of money over time.
Make sure you know all about top up loans before availing one. These are considered as a convenient way to take care of specific financial needs, without having to worry about overbearing interest charges or collateral.
Similar Read: How Can You Benefit from a Top-up Loan?
