It is a type of loan facility offered by banks and housing finance companies to existing home loan borrowers.
Top-Up Home Loans are secured against properties and come with lower interest rates than personal loans.
Under Section 24(b) of the Income-tax Act, 1961, the interest paid on top-up home loans is eligible for tax deductions.
Top-up home loans can help cover education-related expenses, such as tuition fees, lodging, etc.
Top-up home loans can also help pay hospital bills and other medical expenses.
Since these loans are secured against the property, default in loan repayments can attract the risk of foreclosure proceedings.
Compiled by Syed Muskan.