25 JUNE, 2021

While purchasing a house, you may need to apply for a home loan to fund your dream house. Not just to buy a home, but you might also need funds to renovate your house or for other purposes like medical care or your child’s higher education. So, you may wonder how to increase your existing home loan amount. To fulfil these requirements as well as be on track with your EMIs, you can simply opt for top-up home loans. Understand this facility in detail and the benefits of opting for a top-up home loan.

 

What Are Top-Up Home Loans?

A top-up home loan is an additional amount that lenders offer to existing borrowers as a loan. You can get this sum over and above your home loan for any purpose. Lenders set certain criteria for you to be eligible for a top-up loan. The benefits of getting top-up loans when compared to any other loan type are the low interest rates and easy documentation. As you have already completed the paperwork of your home loan with the existing lender, you can avail this facility without much trouble. But you must have a good repayment track record on your ongoing home loan.

In case your home loan with the existing bank has a longer tenure or a higher interest rate, you can switch lenders. By doing this, you can opt for a home loan balance transfer and then you can avail a top-up loan with the new lender. This will enable you to benefit from the lower interest rates offered by the new lender and change the loan tenure as well. But it is advised to plan out your loan repayment and consider the interest burden before changing tenures or the monthly EMI.

 

Benefits of Top-Up Home Loans

Here are some key advantages of choosing a top-up home loan to meet any financial requirement:

  • Simple eligibility criteria
    If you are taking a top-up home loan with the existing lender, the eligibility criteria will be easier to meet. The lender will simply consider your repayment history before sanctioning the additional amount.
  • Multiple usage options
    When it comes to the purpose of top-up home loans, there is no restriction on how you can utilise the sum. Thus, be it your child’s education or marriage, you can use the funds as you see fit.
  • Easy repayment
    Top-up home loans offer longer repayment tenure when compared to personal or gold loans. Thus, you can pay the home loan EMIs without any hassles.
  • Good option for emergencies
    In case you require some funds during an emergency, top-up home loans are the most suitable option. Due to easy documentation and eligibility criteria, the funds shall be disbursed quickly without having to undergo the loan application process.

 

You can now avail a top-up home loan to meet various requirements such as funding home expenses, fulfilling education related funding, or even buying a vehicle, without having to get a new loan.

Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.

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Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.