What is a home loan Top-up-edited

01 Apr 2021

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It's a new year and a new normal in the lives of most people. Yet buying a home of one's own continues to be one of the biggest aspirations. However, with skyrocketing prices of real estate, property purchase remains out of the reach of many individuals. For this very reason, homebuyers are now increasingly opting for Home Loans to fund their dream house purchase. Banks and several lenders these days offer housing finance at competitive rates of interest, subject to several terms and conditions.

Add to that a top-up on your existing Home Loan product. Many banks, like Bank of Baroda, have Top-Up Loan in their range of loan products. As the name suggests, existing Home Loan customers who may need extra funds can opt for a top-up on their running Home Loans. Their eligibility for the same is ascertained by the lender based on your relation with the bank , their repayment history and credit score, among other things. The money from such a loan can be used for various purposes, be it for a wedding, fund your child's education, or renovate/repair your home.

At Bank of Baroda, if you switch your existing Home Loan from another bank via a balance transfer, you can get a Home Loan Top-Up. The minimum is Rs. 1 lakh and a maximum of Rs 2 crore. A processing charge of 0.25% of the loan amount is applicable on a Home Loan Top-Up from Bank of Baroda (minimum Rs 5,000 upfront and maximum Rs 12,500 plus GST).

Are you wondering why you should you take a top-up loan? We try answering that question here. Keep reading to find out more.

Eligibility Criteria for Home Loan Top Up

An existing Bank of Baroda Home Loan customer (including NRIs, PIOs, staff and ex-staff members), who may have availed of a Home Loan under public scheme or staff housing loans, is eligible for a Top-Up Loan on a Home Loan. The applicant must be at least 21 years of age (and a co-applicant should be at least 18 years old, wherever applicable). For a resident Indian applicant, the borrower's age plus the Top-Up Loan tenure should not exceed 70 years, as per laid down norms mentioned under the Bank of Baroda Home Loan Product (the same should not exceed 65 years for in case of NRIs, PIOs or OCIs).

New customers who opt for a Balance Transfer Loan (called a Home Loan Takeover scheme at Bank of Baroda) are also eligible for a Top-Up Home Loan.

Benefits of a Top-Up Home Loan

Minimal documentation, swifter loan approval and disbursal

If you're an existing Home Loan customer, getting a Top-Up on your Home Loan is easier. There is minimal documentation involves since the lender already has most of the required paperwork with you. Plus, knowing your repayment history and credit score patterns makes it more convenient for the banks to go through your Top-Up Home Loan application. This makes a speedy and hassle-free loan disbursal possible. Approach your branch for a quick top up loan.

Attractive interest rates

If you opt for a Top-Up Home Loan, you can get funds at fairly lower interest rates than those available in case of any other personal loan option.

Available for longer tenures

Depending on the period left in your existing Home Loan, you can opt for a Top-Up Loan for a relatively long tenure compared to other loan options.

Can put funds to use for a wide range of purposes

You can use the funds from a Top-Up Loan in any manner you deem fit. The money can be used to finance another home purchase, renovation and extension of an existing house, and even fund medical emergencies, a wedding, or your children's education. No restrictions are placed on how you wish to utilise this option unless you plan to use for speculation or illegal use.

Lower processing fee as compared to personal loans

The processing fee levied by banks in case of Top-Up Home Loans is generally lower than that applicable in case of personal loans.

Conclusion

While one can argue the pros and cons of a Top-Up Home Loan, it does serve as a good source of emergency funds. Moreover, the fact that you can avail of the option on your existing Home Loan makes the process less cumbersome. So if you're moving into that new house right away and need some more funds to settle into your place, this may be an option you'd want to take a look at.

Bank of Baroda customers who wish to apply for a Home Loan Top-Up can visit https//www.bankofbaroda.in/apply-for-baroda-top-up-loan-resident-nris-pios.htm?33 and fill out the form to begin the process.

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Comments

  • Riyazuddin shah
    18 November, 2021

    Yes I am home loan apply now please recovery this message is contact number is nice 90 273 81 966

  • Rohit
    29 September, 2021

    How much cibil score require for topup loan on home loan

What is a Home Loan Processing Fee?

What is a Home Loan Processing Fee?
Banks and lending institutions levy a onetime charge on the different types of Home Loan products. This charge, known as the Home Loan processing fee. It is generally not deductible from the loan amount, and the borrower pays it separately. This is a fee to cover the loan processing cost incurred by the lender or the bank. Some banks may waive such processing charges for a Home Loan as part of special offers.
In the case of Bank of Baroda Home Loans, we charge a unified upfront fee which consist of:

Document Verification/ vetting charges
Pre sanction Inspection (Contact Point VerificationCPV) charges
Onetime postinspection charges
Advocate charges for a legal opinion
Valuer charges for valuation
Bureau report charges
CERSAI charges
ITR Verification charges

Post sanction proceesing fee table of Processing Fees for Home Loan



S. No.
Area of Banking Service
Service Charges (excluding GST)  w.e.f. 20.06.2019


1
Baroda Home Loan & Baroda Home Improvement Loan


Slab-wise
Up to Rs 50 lakh 0.50% of the loan amount: Minimum: Rs 8,500 (Upfront) Maximum: Rs 15,000
Above Rs 50 lakh 0.25% of the loan amount: Minimum : Rs 8,500 (upfront) Maximum: Rs 25,000
The above charges are unified processing charges which include inspection, valuation and legal fees.
The above charges are for all categories of borrowers under Home Loans.




2
Baroda Home Loan Top Up
0.35% Minimum: Rs 5,000 (upfront) Maximum: Rs 12,500


3
Takeover of Home Loan (Resident /NRI/PIOs)
Flat: Rs 8,500 (upfront)


4
Pre-Approved Home Loan (In- Principle Sanction)
0.25% - 0.50%Rs 8,500 (upfront). Suppose the borrower submits the property documents within the validity period of a pre-approval letter. In that case, the balance amount of unified processing charges applicable to Home Loan will be recovered from the borrower.



Charges other than Home Loan Processing Fees
Banks also levy other charges like Home Loan prepayment fees or loan conversion charges. However, in case of a Bank of Baroda Home Loan, there are no charges applicable if the borrower chooses to prepay the loan amount before the tenure is over.
Impact of Home Loan Interest Rates
There is no correlation between the processing fee and the interest rate. However, your loan amount does factor in calculating the processing fee. A Baroda Home Loan is charged at the prevailing floating rate which is linked to external benchmark of REPO( RBI) or MCLR . The interest rate is linked to the Baroda Repo Linked Lending Rate (BRLLR) and is reset annually based on your bureau score(cibil).
Why Bank of Baroda for Home Loans
With a Bank of Baroda Home Loan, you can enjoy a free credit card and concession of 0.25% for car loans. Additionally, the bank offers free personal accident and property insurance with a Home Loan. You can also opt for a group credit life insurance cover when you apply. This cover protects the family against the borrower's death, and the family is not required to repay the Home Loan to the extent of the claim amount. You can pay the premium for the cover along with the EMIs.

What Is A Personal Loan

A personal loan does not require the borrower to provide collateral and so it is an unsecured loan. The purpose or intention of a personal loan is to fund immediate financial contingencies. It could be for business capital, marriage, medical expenses or even foreign trips, though the end use of the capital really depends on the borrower, as long as it is for a legitimate financial need.
Eligibility for a personal loan?
Since these loans are unsecured- at what rate of interest you will get the loan and how much, whether or not you will get the loan-depend on the credit quality of the borrower. If you have good creditworthiness, you are likely to get the loan at an attractive rate of interest. If you have been a long time customer with the bank, with sound track record of financial discipline, you may also get a pre-approved personal loan sanction.
Bank of Baroda lists the following types of employees/self-employed individuals who are eligible for personal loans.

Employees of Central / State Govt. / Autonomous Bodies/ Public / Joint Sector Undertakings, Public Limited Co. / MNCs & Educational Institutions – with minimum continuous service for 1 year
Employees of Proprietorship, Partnership firms, Private Limited companies, Trust - with minimum continuous service for 1 year
Insurance Agents- doing business for minimum last -2- years
Self Employed Professionals (Doctor, Engineer, Architect, Interior Designers, Tech. and Management Consultants, Practicing Company secretaries etc) -- with minimum 1 year stable business.
Self Employed Business persons - with minimum 1 year stable business.

Some of the benefits of a personal loan are
Urgent financial requirement
If there is an immediate need for money, personal loans are the best option. They are considered better than credit cards or loans from family members or unorganized lenders, since the rate of interest is reasonable and the lender is a credible organization. Credit cards come with strict credit limits, which is not the case with personal loans. Funds taken from the bank as personal loan also resolve the issue of certain vendors not accepting payment through credit cards.
Breathing time for repayment
Also, the credit card bills need to be paid off by the due date which generally falls in the next month whereas you get some breather in repaying a personal loan EMI over a period of time, generally ranging from 3-4 years.
Flexibility of use
Funds from a personal loan are flexible in the way you use them. They can be used for several purposes- home renovation, travel, wedding and medical expenses or for any other purpose as per one’s personal obligations..
Loan amount
The loan amount you can borrow under a personal loan is also significant. For example, with Bank of Baroda offer personal loan amounts based on the eligibility of applicants
Confidential
Personal loans may also be private loans since these loans are often used to meet cash requirements or personal contingencies and thus kept private to a great extent.
Flexible repayment structure
These loans are generally of the nature of short to medium term loans and come with a flexible repayment structure.
Easy to get
For example, Bank of Baroda is popular for personal loans that are quick to get, fast processing, minimal documentation required and offered at attractive rate of interests. Most salaried persons, self-employed and professionals can apply for these personal loans.

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