We all dream to reside in our own home. You may have also planned on buying one or put off the plan owing to the lack of funds. In times of such financial emergencies, home loans help us circumvent the lack of money.
A home loan, when managed well, is the biggest realization of such dreams. One thing you are unaware of such loans is that it can help you in various other ways as well. There are some hidden features with these loans that can be availed by home loan customers.
Here are some extra features that the home loans can provide to you other than buying a property.
Access to Top-up loans
If you are a home loan customer, you got an added advantage. Home loans give you access to top-up loans. You can utilize the fund of this loan to fulfill any of your financial needs. Top-up loans are similar to personal loans, but with a lower interest rate.
This way, you can also avail a sum of up to 50 lakhs! To be eligible for a top-up loan, you need to have availed a home loan from a bank.
Tax Relief
Housing loans are one of the best ways to save taxes. Aside from helping you to buy your dream home, these loans can also help you with minimizing the tax deductions. If you have any co-borrowers, they can also avail the benefit!
The sections 24 & 80C of Indian Income Tax Act highlights that you can claim deductions of Rs. 3,50,000 against the interest & principal amount repaid in a year.
Home Renovation
To cover the funds for the home renovation, people choose personal loans. But, opting housing loans for the home improvements can save you from a higher interest rate of personal finance solutions.
The banks usually charge the same rates as their housing loan products for this. The interest rates are much cheaper ranging from 8.30 to 10 per cent.
Boosting the Credit Score
Paying the loan dues on time can tremendously improve your credit score. A good to excellent credit score can help you to qualify for the credit cards with the best rewards.
This score is pivotal for you to get better financial solutions. If you don’t delay or skip paying loan repayments, your credit score will improve.
If you are planning to avail a home loan, being well-informed about these features that it offers you can be extremely helpful. Plan well with the above-mentioned points before applying for a housing loan to completely utilize the features of the loan.