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What is a Home Improvement Loan? When Should It Be Availed?

Updated: Apr 05, 2022
What-is-a-Home-Improvement-Loan-When-should-it-be-Availed

Your biggest investment in life is most likely your home. Therefore, the responsibility to maintain it to high standards of safety ensuring a smooth and convenient lifestyle for your family falls on your shoulders. This may include several rounds of home repairs, remodelling and large scale renovations. A home improvement loan from Grihashakti at this time can come in handy.

What Is a Home Improvement Loan?

The home loan improvement definition emphasizes that it is an unsecured form of credit that a prospective borrower can avail of from a lending partner without having to pledge any asset as collateral. You do not need to put up your home title as security to the lender which is a requirement in other types of home related financing.

Just like any other loan, you have the option to repay the home improvement loan in easy monthly installments. The tenure of repayment varies between 12 months to 5 years. Usually, the installment amount will be determined by the size of the loan.

Typically, the amount of EMI remains fixed throughout this period. Use thehome loan EMI calculator, a free tool we offer, to help you get an estimate of your monthly installment amount.

The borrower is not levied with any additional penalties, fees or charges if the entire loan is paid back within the designated repayment tenure. Moreover, a number of lending partners allow borrowers to pre-close or foreclose the loan before reaching the end date of loan repayment.

Who Should Avail of a Home Improvement Loan?

Anyone who needs to undertake large scale remodelling or renovations with a good credit rating and history can apply for a home improvement loan from reputed lenders like Grihashakti in India. However, you need to make sure that you fulfil the minimum eligibility criteria of your chosen lender before making a formal application.

Even though the parameters of eligibility differ from lender to lender, there are a few factors that are common.

The general criteria include:

  • You should be an Indian resident
  • You should be a minimum of 21 years and at the time of loan application a maximum of 60 years if salaried and 65 years if self-employed at the time of loan maturity
  • You should be salaried or self-employed
  • Salaried applicants must have a minimum work experience of 1 year, with at least 6 months in the current organisation. You should earn a minimum monthly salary of INR 25,000 (residents of Delhi and Mumbai) or INR 20,000 (other Indian cities).
  • Self employed applicants must meet the criteria for minimum turnover and profit after taxes as applicable at the time of loan application
  • You should have a minimum credit score of 700
  • You should have the requisite documentation
  • Cash salary applicants will not be accepted

Your credit history and score also plays a critical role in determining your eligibility for a home improvement loan.

Why Choose a Home Improvement Loan?

You can fund your home renovation project in a number of ways. However, given the modes of finance available, you can have a hard time deciding.

You may choose to use your savings or short term credit instruments if the renovation is a small-time remodeling. Having said that, credit comes with a short repayment cycle.

Unless you are absolutely sure you can pay back the expenses with the given billing cycle, you run a risk of landing into a debt trap as you will be liable to pay supremely high interest rates if you cannot pay your credit card bill in full.

A home improvement loan, on the other hand, offers stability. The rate of interest is usually fixed (depending on the lender’s policy and the agreed upon terms). In many cases, a home improvement loan also offers a lower interest rate when compared to that of credit cards.

What Are the Benefits of Taking a Home Improvement Loan from GRIHASHAKTI?

Applying for a home improvement loan comes with a bouquet of benefits.

1. Easy to Qualify:

Lenders like Grihashakti  offer home improvement loans for up to 90% of the total cost, depending on your eligibility. . 

2. Online Application Process:

You can apply for your home improvement loan online. The process is streamlined and does not take more than 15 – 20 minutes. The online application process allows applicants to upload soft copies of their documents for verification by the lender. In most instances, the loan application is approved within a few business days,  and the funds are disbursed shortly after final approval.

3. Meet Unexpected Expenditures:

Despite the planning, it is not always possible to come up with the exact expenditure figure for your home renovations. You can get an estimate from your contractor at best. Availing a home improvement loan helps you to meet any unplanned expenses that you may incur going forward.

In Conclusion

Home improvements can be expensive. Considering all the financing options at your disposal, a home improvement loan from Grihashakti by Fullerton India ensures that you can embark on your renovation journey at a time that is convenient for you.

To apply now, click the “Apply now” button on this page. Or, you can call  our toll free number 1800 102 1003 between 9.30 a.m. to 6.30 p.m., Monday to Saturday to get more information.

*Terms and conditions apply. Loans are at the discretion of Fullerton Grihahshakti. Eligibility and other terms such as interest rates, fees and charges, etc. are applicable as per our policy at the time of loan application.

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