What is a Home Improvement Loan?

by Ajay Singh Financial Advisor

For an Indian, a home is an aspiration and a comfortable den to reside in and be comfortable. It is possibly the best investment and we usually prefer sticking to our own home and not changing it very often. However, a home needs a lot of repairing and renovation did when it is an old property. The need for renovation is more when there is a festive season in India. A lot of Indian families try out every possible way to renovate and decorate your home in a wonderful way. It is a huge ticket expense that needs to be supported by a home renovation loan. You need a huge amount of money to get the renovation done. You can take a home renovation loan against your property. It is a secured and flexible loan that can be used for the renovation of your old home into a new one. If you are seeking out a low rate of interest and a fast home loan, you will have to meet the eligibility criteria.

What is a home renovation loan?

A home renovation loan is a type of secured loan, where the security is your home and you get funds to meet the expenses of renovating your home. It comes in a one-time disbursement and you can use the fund for anything related to renovation. You can expand, construct, remodel or go for any sort of painting, fitting and modular facilities. A home renovation loan comes with a rate of interest and other charges.

Eligibility criteria for a home renovation loan

Income stability: Home renovation loan approval will seek the right income stability. The source of income should be stable for both salaried and self-employed individuals. Self-employed individuals should be stable in terms of cash flow, statement, balance account, and revenue. For the salaried employees, the full-time permanent position and employer will play an important role.

Security of property: A home renovation loan is usually given to those with a secured property. The home renovation is done on the very same home property and that is why it is a secured home. So, borrowers that need a home renovation loan needs to have their own home. You cannot borrow a home renovation loan to make renovation or remodeling on your rented apartment. The home should be yours, and that makes it eligible for a home renovation loan.

Good credit score: A credit score is an inevitable thing in the credit eligibility of a home renovation loan. The borrower must have a good credit score that is above 750 to make sure he is worth borrowing a loan. This will help you convince your loan provider and that gets you easy approval as well as a low rate of interest. It will be useful for you to manage your loan affordably. A good score represents timely payments, good long credit age, and no outstanding or overdue credit card bills.

Documents for a home renovation loan

●        Income Tax Returns (ITR) of last 3 years

●        Passport

●        Voter ID

●        NOC form

●        Property papers

●        Balance Sheet and Profit & Loss Account Statement of the Company

●        PAN Card

●        Aadhar Card

●        Application form

●        Passport size photograph

●        Form 16 for 2 years

●        Salary slips of 3 months

●        Business proof

 

Finishing up

If you need to go for a home loan or home improvement loan, make sure you consider the right total cost of the loan. If you need a fast home loan for instant buy, you can visit Clix Capital to get a smooth borrowing experience.

Must Read : Know the Eligibility & Benefits of Home Improvement Loan

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Created on Oct 26th 2021 06:26. Viewed 220 times.

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