Homeowners can avail up to an advance of Rs.25 lakh as a home improvement loan and utilise the amount without any end-use restrictions. This loan also comes with flexible repayment tenors of up to 60 months.
Borrowers should consider the following factors while availing loans for home improvement –
- Choose the loan amount wisely
While renovating or remodelling homes, individuals should opt for external funding only if that enhances the value of the property, or whether it is cost-effective in the long-term.
Homeowners also need to measure the correct home renovation loan amount before applying for it. Otherwise, they can end up over-investing and borrowing funds more than their repayment capacity. Thus, to avoid these errors, they should check a rough market value of the concerned property and decide the right personal loan amount.
Furthermore, with the help of a personal loan calculator, individuals can calculate the possible monthly instalment and decide a proper loan amount as per their monthly obligations.
They can also use a personal loan eligibility calculator to check the loan amount they can avail based on a few details.
- Consider a lender with better facilities
After assessing the required amount, borrowers can compare this financing facility from different financial institutions. Several lenders offer a personal loan for home renovation at competitive interest rates and other benefits.
To repay the loan amount faster, individuals should always look for a personal loan with low interest. Moreover, depending on the repayment capacity, borrowers should go with shorter possible tenors. Loans with shorter repaying tenors lower the interest, which eventually reduce the total payable amount.
Thus, individuals need to compare the available loan options and select the correct deal for them.
- Check eligibility criteria
Before deciding the final product, borrowers need to check their eligibility criteria for a home improvement loan. Most importantly, they should check their credit score.
Borrowers with a higher credit score around and above 750 or more are preferable for unsecured loans like a personal loan. Financial companies prefer a less risky profile with excellent credit history and a strong credit rating for these types of loans.
Also, to avoid loan rejections, aspirant applicants should consider other required eligibility criteria like residential status, age bars, employment, and financial statements as well.
They should remember that loan application rejection affects credit history negatively and reduces the possibilities of future financial support.
- Look for other available benefits
Personal loans come with another cost-effective feature called flexi loan facility. Flexi loan feature allows the borrowers with a pre-sanctioned loan amount that can be withdrawn anytime. Contrary to other loan facilities borrowers need to pay interests only on the utilised fund and not on the total approved loan amount.
With the help of this benefit, borrowers can save a considerable amount while repaying their home improvement loan.
- Check the documentation process
Borrowers should also look for easy and minimal documentation processes to fund home remodelling. KYC documents (Aadhaar, PAN, voter ID, passport, driving license, etc.), address proof, salary slips, bank account statements, and employment ID are the basic needed documents for the loan approval process.
After verifying the credentials and eligibility, the loan amount can be disbursed to the applicants within 24 hours. Individuals can also opt for an online application process for faster documentation and verification.
Financial organisations like Bajaj Finserv even provide pre-approved offers for a hassle-free and easier loan approval process. Other than personal loans, these offers are also available on several financial products like business loans, credit cards, etc. Borrowers can check their pre-approved offers by entering their mobile number and name online.
So, without utilising savings or investments, individuals can opt for a home improvement loan to renovate or upgrade homes and also for interior decorations. The above were some of the reasons individuals should finance home renovation with a personal loan.