Hello Jyoti, we were discussing the difference between home loan and personal loan and which one would be better for us a while ago. We decided after comparing the two, so I can help you with this.
Personal Loan or Home Loan Which is Better?
Below, I am sharing the difference between the two loan types to help you analyse which one works for you.
| Home Loan | Personal Loan |
The processing time for home loans is greater. |
The processing time is quicker due to their unsecured nature. |
You can get tax exemptions under Section 80C and Section 24 of the IT Act. |
There are no tax benefits under personal loans. |
They offer a greater loan amount. |
The loan amount is lower due to their risky nature. |
Ideal for purchasing a home, or plot, constructing a new home or doing repairs. |
Ideal for travel loans, wedding loans, pension loans, etc. |
This is all about the personal loan vs home loan interest rate and more. I’d recommend you see what your needs are out of a loan and then decide accordingly.
As Mr. Sunderasan said in his answer, you should seek help from a financial advisor for more clarity.
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It is crucial to take your demands into account when deciding between a home loan or personal loan which is better. When borrowers are ready to buy a property on their own, they typically look for home loans. On the other hand, a personal loan can be the ideal choice if you require a little extra cash for several purposes like financing a wedding, travel, and so on.
Which is Better Home Loan or Personal Loan?
| Parameters | Home Loan | Personal Loan |
Collateral |
A homeowner's home will be taken as collateral by banks and lending organisations if they are unable to repay a mortgage or other debt. |
A personal loan is not secured, in contrast to a home loan. Therefore, while obtaining a personal loan, collateral is not required. |
Loan amount |
Higher loan amounts |
Lower to moderate amounts |
Loan Tenure |
Long term |
Shorter period ranging from 1-5 years |
Interest rates |
Lower interest rates |
Slightly higher interest rates |
Tax benefits |
Benefits of taxes on principle and interest paid |
No specific tax benefits |
Ultimately, consult a financial advisor to assess your situation and make the best choice regarding home loan vs personal loan which is better for your specific needs.
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What is the Difference Between Home Loan vs Loan Against Property?
Which is Better Home Loan or Personal Loan?
Jyoti
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2024-01-30T11:36:33+00:00 2024-01-30T11:36:33+00:00Comment
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