Everyone wants to find shelter and comfort in a good home. The four walls and a roof above does not make a home. It is essential to renovate your homes to meet the residents’ aesthetic standards and comfort level and the visitors. Your home is a reflection of your status and lifestyle. Therefore, it’s vital to invest in a good home and also maintain and renovate it from time to time. Home renovation could get messy and costly. However, you don’t need to wait until you save up sufficient funds to renovate as per your requirements because you can avail of a home renovation loan!
A home renovation loan is similar to a home construction loan. While a home loan helps you acquire a house, a home construction loan enables you to build one. Home renovation loan assists in the modification, refurbishment, or renovation of your home.
Here’s why opting for a home renovation loan is a good idea!
Lower interest rates:
You can avail of a home renovation loan at attractive rates. Opting for a personal loan for your home’s renovation is not an ideal decision because the interest rate on such a loan is usually high. A personal loan is an unsecured loan. In contrast, you can avail of a home renovation loan at the same rates as a home loan. This one’s a better deal since it’s secured against your homeownership.
When you avail of a home renovation loan, you can enjoy tax benefits on the interest component. Under section 24, you get a deduction of up to Rs. 30,000 per annum for the interest you pay on the home renovation loan. The deduction of Rs. 30,000 is within the overall limit of Rs. 2 lakh. This amount is available on loan interest payment of self-occupied homes. Expressly, interest payments on the home and home renovation loan together qualify for a deduction of up to Rs. 2 lakh. You could save up on taxes up to Rs. 10,300 owing to the Rs. 30,000 deduction. Thus, the overall cost of borrowing is lowered.
The documentation process for this type of loan is quite essential. When compared to the other modes of financing, home renovation loans do not require extensive documentation. You will need personal documents like identity/income proof, photographs, a property title deed, etc.
If you’ve taken a home loan from the same lender and are an existing customer, the process eases out further.
You don’t need to wait for a long time once you’ve started the application process. Since the process requires minimal documentation and is hassle-free, your home renovation can begin at the earliest with a home renovation loan!
Flexibility to spend:
A striking benefit of a home renovation loan is the flexibility it offers. The borrowers can use these funds for a range of activities at home like repairs, flooring, extension, painting, etc. From civil work to carpentry, painting to masonry- you can use the money to pay for anything that pertains to the structure of your home.