We all know that a home loan is a tool to help finance the purchase of a home or property. Of course, in this domain, housing loans are the ultimate solution. However, did you know that such loans can help in various other ways as well? If you aren’t too sure about what we are talking about, don’t worry, very few people know about these hidden features. This is exactly why the following article will highlight them for you – hopefully, they will help you make full use of such loans if and when you ever opt for one.
1. Give you access to top-up loans.
Probably one of the best-kept secrets of a home loan is the fact that it gives you access to top-up loans. These loans can be availed only by home loan customers and the funds availed from such loans can be used to fulfill any financial needs. This makes them exactly like personal loans. The only difference is the rate of interest. Where personal loans come with extremely high rates, a top-up loan will be made available to you at rates in every similar to that of a home loan. Besides their near home loan interest rates, these finance solutions can also fetch you amounts up to 50 lakhs!
2. Tax Savings.
Of course, besides helping you purchase your dream home, a home loan can also help you save loads of money every year by deflating your taxable income. Together, you can claim deductions of Rs. 3, 50,000 against the interest & principal amount repaid in a year. This is as per sections 24 & 80C of the Indian Income Tax Act respectively. Moreover, this benefit can be shared all co-borrowers as long as they are co-owners of the property!
3. Home improvements.
Many turn to a personal loan to cover the cost of home improvement. However, this means enduring the higher interest rates of personal finance solutions. This is easily avoided by taking a home loan for home improvements. Most lenders will offer the same rates as their housing loan products. This is usually in the 8.30 to 10 percent, much cheaper than personal loans.
4. Credit scores.
A home loan is one of the biggest forms of debt for the common man. Therefore, repaying your home loan on time will tremendously boost your credit score. This will help you get better financial solutions in the future. The best part is that this will happen just as long as you make all the payments on time.
So as you can see, besides for helping you make the dream home your own, a home loan can also help you in significant other ways. Therefore, if you’ve been planning to take a housing loan to complete your homeownership plans, we suggest you go ahead and put in the application. Further, you can use the points mentioned above to make the most of your home loan. We hope this has been helpful, good luck and congrats on your new home!