Step-Up Home Loans: All You Need To Know

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Home Loans

Home loans in India have become increasingly varied, catering to a range of financial needs. Step-up loans have arisen with a particular structure that adjusts to borrowers' growing salaries.

Home Loan

Step-Up Loan

Step-up loans are loan repayment options available for borrowers who can start to repay the loan amount with smaller monthly instalments which progressively grow during the loan period. This differs from normal EMI payments.

Step-Up Loan

How It Works

Step-Up loans start with lower EMIs, which increase annually as the borrower's income rises. However, these loans carry risks as the borrower's income growth may not match inflation and interest rate hikes, which can make the loan more expensive over time compared to standard EMIs.

How it works


Step-up home loans have benefits like higher approval chances, eligibility for greater loans as the income increases and early access.


Tax Savings

Under Section 24 of the Income Tax Act, borrowers might receive tax benefits.


How Is It Different From Top Up Loans

Top-Up Loans give borrowers who currently have personal loans more cash while Step-Up Loans are designed to finance a home based on predicted income growth. The interest rates of the Step Up Home loans are often lower.

Compiled by Syed Muskan

Top Up Vs Step Up Loans