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Why home improvement loan is better than a personal loan ??
You need much more than good taste to do up your home – you need a stockpile of moolah. Quite often, the only thing that stops people from revamping their homes is lack of funds. Even when you are convinced that your house badly needs a face-lift, the financial enormity of a renovation makes you stop in your tracks and retrace your steps. Home improvement loans enable you to complete this journey that you have started. “Home improvement loans can be used for any purpose related to enhancing the life or beautification of a house –excluding furnishings.” More specifically, a home improvement loan can be used for external repairs, tiling and flooring, internal and external painting, plumbing and electrical work, waterproofing and roofing, laying grills and aluminium windows, waterproofing a terrace, constructing an underground/overhead water tank, paving a compound wall and/or installing a bore well.

Just like home loans for a new house, home improvement loans also come with a fixed and a floating/variable interest rate option. Several housing finance companies offer home improvement loans at the same interest rate as home loans, while some may charge a premium of 0.50 per cent to 1 per cent. In some cases, you may also have to pay a processing fee of 1 per cent to 2 per cent.

In Brief
Home improvement loans are intended for all purposes related to enhancing the life of or beautifying a home, excluding furnishings.
1. A home improvement loan is better than a personal loan because it offers a lower rate of interest and is available for a longer tenure.
2. Home improvement loans also offer tax benefits while personal loans do not.
3. The property that is being renovated is mortgaged to the lender.
4. Many banks and housing finance companies provide the option of borrowing as a group, which would at times attract a lower interest rate.
posted by Joby @ 2:09 PM   0 comments
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