A home is not just a shelter where you get back after a tiring day, and it is your pride that reflects your accomplishments, personality, and status. However, you often tend to put your home renovation goal in the backseat because of inadequate funds. Here's where a home renovation loan, a variant of a personal loan, comes in handy. You can opt for a home renovation loan to renovate, refurbish, or modify your home as per your preference. 

Using a personal loan for home improvement allows you to easily manage major or minor financial mismatches incurred during home painting, kitchen remodeling, décor change, or any other customized implementations. Same as a personal loan, a home renovation loan is a security-free loan with lower documentation and instant disbursal features. 

Discussed here are some of the important benefits you must be aware of before you hit on the personal loan application option to meet your financial mismatches for home improvement – 

Higher loan proceeds without any security requirement – 

You can avail of loan proceeds of up to Rs 40 lakh to meet your home renovation requirements. Note that with the proceeds, you can also buy goods like electronics for the home, such as a television, washing machine, air conditioner, etc., for a complete home makeover. 

Owing to the unsecured nature of the loan, you do not need to provide any security. The lender evaluates your application and approves it based on your income, credit profile, previous repayment behaviour, and others. Thus, you do not need to block your assets to avail of a loan. This means you can keep your investments and use the same in the future to meet your long-term goals. 

Fast processing – 

In most scenarios, home renovation is undertaken for some special occasion. As minimal documents are required by the lender, it takes less time to evaluate your credit profile and income and hence the lender may disburse the loan at the earliest in the case of a regular personal loan. However, in the case of a pre-approved personal loan, a lender may disburse the loan proceeds on the same day of placing an application for the loan. 

Provision to make repayment in the form of EMI – 

Home renovation loan allows a repayment tenure of between one and five years. You can choose any tenure based on your repayment capacity and cash inflows and repay in the form of personal loan EMIs. To compute a favourable EMI and tenure, you can use an online personal loan EMI calculator. 

Ending note 

From the above-mentioned benefits, it must be clear that a home renovation loan can act as a saviour in occasions of financial mismatches when renovating your home. However, before you opt for this option, ensure to use an online personal loan calculator to calculate the suitable figures as per your repayment potential to make an informed decision about the loan.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. 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 the Bank. The Bank, 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. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.