Need money urgently? Top-up home loan is cheaper than other products

A borrower can also get a tax deduction if the funds are used for home renovation, purchase or construction

• Top-up home loans are popular with salaried people who use it to meet large expenses such as home renovation or child’s education or wedding. Many business owners opt for it to meet their cash flow needs
• It is the cheapest loan product for raising funds. The rate of interest is marginally higher than that of a home loan. Lenders don’t put any restrictions on fund use
• It is, therefore, better when compared to personal loans or loan against securities. Using a top-up loan to consolidate other expensive loan is a good idea
• If the loan is used for purchase, construction, repair or renovation of a house, the borrower can even get tax benefit on it. The extent of deduction varies depending on the end-use
• The maximum loan tenure also varies widely — between five years and 30 years. It depends on the borrower’s age and the remaining tenure of the home loan
• Lenders first look at the payment track record and then credit score before approving the top-up loan. Irregular payment can lead to rejection