There are different sorts of home loans.
Home Purchase Loan: This type of home loan is used when the buyer is directly purchasing a new property from the seller. Both floating rate and fixed rates are provided on this type of loan.
Home Construction Loan: This is another type of home loan product in which the financial institutes offer the finance to a customer so that they can build a home in a selected area or a plot according to their choice. The main feature of this loan is that loan is disbursed in installments as per the customer’s requirements. Additionally, save extra by paying interest only on the funds used instead of the total amount.
Home Improvement Loan: Home improvement loan is also known as a home renovation loan. This loan is provided to the customer when he/she wants to renovate his property that has already been constructed. The criteria and documentation of this loan are similar to any other loan. The expenses included in this loan are paintwork, plumbing work, electrical work, repair work, etc.
Land Purchase Loan: According to the name only, this loan is provided to a customer in order to purchase a plat or lands. The bank usually provides funds 70-80% loan amount, against a plain land or plot.
Home Loan Top-up: This loan is provided only on the running home loans. The rate of interest on this loan is lower as compared to a personal loan and mortgage loan. In this important point is that home loan top-up is sanctioned only when existing home loan has a regular repayment schedule for 2 years. The main feature of this loan is less documentation and quick disbursement. The loan amount of this loan can be used for any purpose like in construction, renovation, wedding, vacation trip, etc.
Home Loan Balance Transfer: Most popular home loan among customers is Home loan Balance transfer. In order to reduce current interest rate, balance transfer facility is used. And we can also take Top-up loan along with Bank transfer.