Introduction

You could have the notion to add on to your house, but you might be concerned about the cost and the financing choices. Of course, using a loan for home improvement is one alternative. Consider the following if you’re seeking for a less expensive method to do this project:

You can borrow a much higher sum with a personal loan.

You may borrow money to modify your house using both personal and home renovation loans, but a personal loan allows you to borrow a lot more money. The method used to determine the interest rate is the major cause of this.

Personal loan interest rates are variable, meaning they can change from time to time. On the other hand, loans for home renovation have an interest rate that remains constant throughout the loan. Because of this, they are less flexible for borrowers who wish to modify their borrowing in response to changes in their financial status or other situations. Instead, they are more steady (such as rising rates).

The maximum loan amount you can borrow

In Singapore, a Home Renovation Loan has a maximum loan sum of S$30,000 and a minimum loan amount of S$1,000. A personal loan, subject to approval and availability, may give up to 4X (or up to 8X for some institutions) your monthly wage. Generally speaking, if you’re searching for more than S$30,000 to complete all or part of your home improvement demands (e.g., kitchen). So a personal loan would be more appropriate for your case than getting two different loans, one for other uses and the other for home improvement requirements (e.g., holiday).

Interest rates

Regarding interest rates, banks normally provide loans for house renovations in Singapore at a rate between 1% and 3% annually. Moreover, banks may impose a handling fee that ranges from 1 to 3 percent. The interest rate for a personal loan is often lower (1–6%) than that of a home renovation loan provided by a bank. Also, there are no extra fees or costs levied by personal loan providers while processing your application or transferring cash to you. Thus, they are your best option to reduce your interest payments while still comfortably funding your project. But, the Pocket Insurance & RFID Cardholder may take advantage of loan amounts up to S$100,000 with Personal Loans from Bajaj Finserv at interest rates beginning from 2.99% and processing costs as low as S$0 (T&C Apply).

Personal loans might be a great choice if you’ve been considering upgrading your house but have been deterred by the exorbitant cost of repairs. You may modify your house with a personal loan and a customizable payback plan. This article could interest you if you want to expand your house or carry out any other significant home improvement project, including constructing a new deck or a carport. In this article, we’ll talk about how personal loans could help with funding these tasks and why they might be better than other financing choices like home improvement loans or remodeling loans provided by banks and credit unions.

Instead of home renovation loans, you may decorate with a personal loan.

Why should you use a personal loan instead of a home remodeling or renovation loan to expand your house? Personal loans are cheaper, flexible, and simpler to get than home remodeling loans. Personal loans are not limited to home expansions. Personal loans offer lower rates and fees than home remodeling loans. Long-term monthly payments will be lower. Most banks provide personal loans at fixed rates from 2% p.a., so there’s no need to worry about changeable interest rates or hidden fees associated with variable rate mortgages or HELOCs (home equity lines of credit).

Conclusion

So, a personal loan is preferable than a Singapore Home Remodeling Loan for house renovations. Personal loans let you borrow more at cheaper interest rates and no fees.