If you are building a new home, the cost sometimes goes over the budget and you may come across unplanned expenses too. Actually, there is no limit on adequate funding to meet your expenses when you are building a new home. Figuring out the estimated cost of building a new home in advance won’t be possible. There is no denying that spending 20%-30% over the budget is normal as there is always a 1% chance that the last minute modifications and designs are implemented. After all, you are building a dream home for your family.
What if the construction budget exceeds and you require more money for essential expenses? Of course, this situation is not uncommon and you may roll over the credit card amount to meet your expenses. However, it is not at all the best financial decision to make. This will end up increasing your financial burden and existing debts. Now, what you should do to deal with the situation?
Can You Apply for Home Loans and Personal Loans Together?
Is it aviable to take a personal loan with your existing home loan? Well, taking out personal loans and home loans together can be the right way to overcome the financial burden with ease. Fortunately, there is no restriction on your borrowing limits until you are maintaining a good repayment record in history. If you have a good credit score, you can consider taking out another loan. As far as you meet the eligibility criteria set by the banks, you have the opportunity to take out personal loans and home loans together.
Some Conditions that Can Help You Take Out Both Loans Together
If you apply for personal loans after taking the home loans, you should take care that your debt to income ratio is not more than 50%. When you earn enough to manage the repayments of both loans in a timely manner, you have nothing to worry about. But, certain conditions are there that you should take care of. To secure adequate funds, you should consider the following factors carefully.
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Make Sure Your Credit Score is Healthy
When you have got an idea of applying for home loans and personal loans together, make sure you have a good credit score. If your credit score is healthy, only then you can improve your chances of approval on two loans together. This is because banks get impressed with the consistency in repaying loans in the past.
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Consider Your Debt-to-Income Ratio
You should consider your debt-to-income ratio before reaching out to your preferred bank to get personal loans and home loans together. This ratio is the sum of your debts divided by your total gross monthly income. The debt-to-income ratio should not exceed more than 50 percent of your income.
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Apply for Loans with Flexible Terms
Taking out two loans together means taking out double responsibility and this is why you should borrow funds wisely. Personal loans are unsecured loans and come at high interest rates. On the contrary, home loans are secured in nature and may come at affordable interest rates. Don’t forget to read the terms carefully before availing loans.
When it comes to applying for loans, the above-mentioned three conditions make a huge sense. This is why you should never overlook all the conditions listed above and take financial decisions wisely.
Prove Your Eligibility First
In a time of need, taking out two loans together makes sense only if you are capable of managing them simultaneously. Once you make up your mind about two loans, it seems important to check your eligibility. Check if you can qualify for both home loans and personal loans. This will paint a clear picture of your future finances when need adequate funds to build a dream home. After considering all the factors, you should move ahead and prove your eligibility.
Wondering what makes you eligible for both personal and home loans? So, have a quick glance at the eligibility criteria:
- You need to be a salaried person with a minimum annual income as specified by the bank’s policy.
- You must have a minimum of 1 year of experience with tenure of at least 6 months in the recent company.
- You should earn a minimum of 25000 per month.
- Your CIBIL score should be above 700
To prove your eligibility before the bank, you must consider the points mentioned above. Once you qualify, you will get approval on your loan request immediately.
Meet the Requirements and Get Funds in Hands
Now, what’s next? After considering all the points, you will check your eligibility. Meet the requirement and fill out the application form. Don’t forget to compare the interest rates and other lending policies of varied banks to make sure you are borrowing funds in a hassle-free way. Once you have found a trusted bank where you can apply for personal loans and home loans, you should fill out the form and provide relevant documents that support your application. You will get approval on your loan request immediately as the bank found you eligible. You will get your funds in your hands once your loan request is approved. This might sound easy but this process can be tricky in some scenarios.
Now, check your eligibility for personal loans and home loans to avail both together.
