Purchasing a house is a dream come true for many. However, the struggle does not end here. Even after buying a house, timely renovations are a must. It may be due to trends and the increasing number of family members that you consider a home renovation. With renovations, you can make your trendier and more comfortable. Making changes in the house will come at a considerable cost. Many feel confused between Home Renovation Loans and Home Extension Loans.
Below, we will understand the differences between the two and know how to make a suitable choice.
What is a Home Extension Loan?
As a family increases in size and age, its space requirements also evolve. Instead of shifting to a new house, many decide to add new spaces to their existing structure to accommodate their family needs. It is an excellent option to increase the available space at a fraction of the cost. Whether the house needs an extra room, more bathrooms, a home office, or more space for any other purpose, a home extension eliminates the need to look for a new home.
Although a home extension is certainly cheaper than shifting to a new house, it still involves a considerable cost. A Home Extension Loan makes the funds available for you. Apply for this Home Loan after evaluating the costs involved in the extension.
Benefits of a Home Extension Loan
These are a few key benefits of taking a Home Extension Loan:
- No Need to Look for a New House: A home extension is better than purchasing a new house. You can make new home additions without shifting using a Home Extension Loan.
- Easy Approval: These loans are easy to apply for and obtain online with minimal documentation.
- Long Tenure: Most loan companies have long loan tenures for Home Extension Loans, allowing borrowers to repay in easy EMIs without any financial burden.
- Tax Benefits: Borrowers can claim a tax deduction of up to Rs. 30,000 under section 24B on the interest on a Home Loan for an extension.
What is a Home Improvement Loan?
With each passing year, new trends and technologies enter the market, making people’s lives easier and more comfortable. Every house requires regular improvement to increase the family’s comfort level and add value to the property’s cost. That is why many homeowners upgrade their old houses to accommodate the most modern tools. Many home improvement projects also include general repairs, remodelling, and repairs. Home Improvement Loans aim at meeting the substantial costs of these upgrades, which are in demand. Housing loan companies sanction improvement loans based on the approximate cost of the planned improvement project.
Benefits of a Home Improvement Loan
These are a few key benefits of taking a Home Improvement Loan:
- Low-Interest Rates: A Home Improvement Loan usually comes with affordable interest on Home Loan for renovation. It puts minimal pressure on the borrower’s finances to keep repayment easy to handle.
- Easy and Smooth Loan Process: Only a few basic documents are necessary to take out a Home Improvement Loan. The entire process is digital, easy, and smooth, making funds available in minutes without hassle.
- No Collateral Requirement: Borrowers do not need to provide any collateral to obtain a Home Improvement Loan. Therefore, it is a less risky loan option for borrowers.
- One-Stop Solution for all Home Improvement Needs: Borrowers can use a Home Improvement Loan for any home renovation, repair, or upgrade project. Since all these tasks come under the umbrella of home improvement, it serves as a one-stop solution for all requirements.
Both Home Improvement Loans and Home Extension Loans have different purposes and advantages. So borrowers must evaluate their needs and apply for an appropriate loan type to get the maximum benefit.