How to Use Collateral to Clear Home Renovation Debt

More often than not, people tend to take a large finances for the purpose of home renovation. This can be done using credit cards, unsecured loans or other finance options which can lead to huge debts. To get out of this, the best recourse is to consolidate the entire home renovation debt by taking a single loan against property for debt consolidation. 

By pledging your property as collateral, you can borrow as much as the value of your property which can be used to repay the existing debts in a single more affordable monthly installment. 

Some of the other benefits of using your home as collateral to pay off your existing home renovation debts are as follows - 

Lower Interest Rates

Having an outstanding debt can greatly affect your credit score and which in turn makes it difficult to acquire unsecured loans. Despite this, you can still acquire a loan against property which is a secured loan and the value of the disbursed amount is based on the value of your property. The interest rates are much when compared to unsecured loans. 

This is owing to the fact that a loan against property is a secured loan in which you have to offer your property as a collateral which makes you eligible for lower interest rates. This in turn makes it easier to pay off your home renovation debt using a loan against property. 

Comfortable Tenor

There are a number of lenders available today who offer loan amounts of up to Rs. 1 crore to salaried individuals and up to Rs. 3.5 crores to those who are self-employed. Such an amount is more than enough to pay off any home renovation debt which you may have incurred. Additionally, the repayment period is also a long one varying for ranging from up to 18 years for self-employed and up to 20 years for those who are salaried. As the repayment period is so long, it gets very easy to repay back the loan. 

Additional Reads:

Renovate your Home Easily with Loan Against Property Renovation Loan

Loan against property for Home Renovation