“8 Types of Home Loans in India Offered by Banks and NBFCs”

Home Loan or Housing Loan in India

If you are planning to take a home loan , there are majorly 8 Types of Home Loans in India Offered by Banks and NBFCs. In this article, we aim to provide detailed information regarding these specific types.

1. Home Purchase Loan

This loan is provided when you are directly purchasing a new or old property from a seller or builder. The bank or NBFC provides this loan based on the market valuation of the property. A key point to remember is that the loan amount is not disbursed into your personal account; instead, it is paid directly into the seller’s account.

2. Home Construction Loan

If you plan to construct a house yourself, this loan is provided by lenders to build on your own land or plot. In this case, the bank provides the loan amount in tranches (installments) rather than a lump sum. If you are planning to take a construction loan, you should keep some of your own budget ready, as companies release the next tranche of money only after specific stages of construction are completed.

3. Home Improvement or Repair and Renovation Loan

If you already own a house but need to carry out repairs or want to renovate, you can apply for this loan. It is granted based on the current condition of your property and the renovation requirements. Depending on the lender, this loan can be provided in tranches or sometimes as a one-time disbursement.

4. Home Extension Loan

A Home Extension Loan is provided by banks when you already own a house but wish to add more space, such as building extra rooms or adding new floors. At that stage, you can apply for this specific extension loan.

5. Plot Purchase Loan

A Plot Purchase Loan is for those who are not planning immediate construction but want to buy a plot of land for future use. Similar to a purchase loan, the amount is mostly disbursed directly to the seller’s account by the bank.

6. Balance Transfer Loan

If you currently have a home loan with a bank or NBFC, but another company offers you a lower interest rate or you are facing issues with your current lender, you can transfer your existing loan. In this case, the new company closes your existing loan account by providing a closure cheque, and your loan journey continues with the new lender under new terms.

7. Home Loan Top-Up

A Top-Up loan facility is offered by most banks and NBFCs, usually after you have maintained a clear repayment track for at least 12 months. If you have been repaying your home loan regularly and suddenly need funds for personal needs—such as a wedding, business expansion, or education—you can apply for a Top-Up. This works similarly to a personal loan; you can use the funds for any personal requirement, and it does not have to be used for house building.

8. Bridge Loan

Bridge loans are not commonly provided by all banks or NBFCs and are only offered by specific companies. If you are selling your current home to buy a new one, this loan helps cover the financial gap during the transition. The tenure for a bridge loan is much shorter than other housing loans, usually ranging from 6 months to 2 years.

We hope that you will understand some different types of Home Loans in India which is generally provided by the banks in India. We are going to provide all the information related home loan, personal loan, business loan etc.

If you have any query you can ask us about Home Loans in India in comment box.

You can read our below mention article also for understanding that what is the eligibility required for home loan.