What is Top up Home Loan? Know the special things related to it

Top-up Home Loan: Everyone dreams of having their own house. A house is the biggest purchase in a person’s life. Often people take home loans to buy a house. Home loans are the longest-term loans. Many times, even after taking a home loan, money is needed to buy or build a house or for other purposes. In such a situation, a top-up home loan is very useful. Instead of taking a personal loan with a high interest rate, you can take a top-up home loan. The interest rate in this is low. Also, the customer gets a good deal. Top-up home loans are offered to those customers who have already taken a home loan. If you need additional money apart from the home loan, then a top-up home loan is a good option. Let us know some special things related to top-up home loans. 

Key features of top-up home loan

1. Top-up home loans allow customers to avail of additional loans over and above their existing loan amount.
2. Many times, there are some additional expenses apart from the home loan. Home loan top-up can cover these expenses.
3. A top-up loan gives the customer a better deal than his existing lender. This reduces your overall cost of borrowing money.
4. Top-up home loans are an affordable solution to manage your debt.
5. If the customer repays the home loan for 12 months without missing any EMI, he becomes eligible to avail home loan top-up.
6. The amount sanctioned by the bank will also depend on the monthly installment repaid in the regular home loan. This will save you from having to apply separately for a personal loan.
7. Top-up home loans are quite beneficial for customers if you choose a shorter tenure for repayment.
8. The tenure of top-up home loans varies from bank to bank. For example, the State Bank of India offers top-up home loans for a tenure of up to 30 years.
9. The interest rate on top-up home loans is usually slightly higher than the rates of regular home loans. These rates also depend on the customer’s profile.
10. The difference between home loan and top-up home loan rates is usually between 1 to 2 percent.