What is an Overdraft Home Loan
When you want to manage your unplanned expenses, you can easily access additional funds with the help of a Home Loan Overdraft Facility. The only condition being, you need an ongoing Home Loan with your respective bank to avail this service. Read further to know more in detail.
If you have taken a Home Loan from any bank or financial institute, then you are already liable to pay the loan amount. There may be times when you may miss your EMIs and require immediate funds to meet certain financial needs. In such circumstances, you can avail an Overdraft on the existing Home Loan, which can help you to fulfil a short-term monetary need. For instance, ICICI Bank offers a Home Loan Overdraft Facility in the form of a Top-up Loan on the existing Home Loan, Loan Against Property or Loan against rent receivables.
What is an Overdraft Home Loan?
Need instant cash to fund an emergency? An Overdraft Home Loan Facility is a simple solution for your financial worries. The product is offered to borrowers, allowing them to withdraw or overdraw funds from their Savings or Current Account and pay interest only on the utilised amount. Apply for an OD facility available in the form of an ICICI Bank Home Loan Overdraft. It has all the features of an unsecured loan.
Let’s understand the features of a Home Loan OD:
- Flexibility to withdraw funds anytime, when the need arises
- Get an Overdraft limit of up to 90% of your Home Loan
- You pay interest charges only for the used amount
- You can avail the reverse sweep facility, when the money from the OD Facility is moved in the Savings Account for withdrawals
- Get reducing Overdraft, with the monthly dropdown in limit. This means that withdrawal of the amount from the OD Account every month, reduces the sanctioned limit
- No lock-in period, as borrowers can close the Overdraft Account, anytime.
Eligibility criteria for an Overdraft Home Loan:
- The bank assesses the financial health of a borrower to determine the Overdraft limit
- You can avail a loan amount ranging from Rs 5 lakh to Rs 5 crore
- Both salaried and self-employed individuals can apply for the loan; however, the loan amount would vary, depending on the borrower’s profile
- You can use the Overdraft Loan for business and personal needs.
An Overdraft on Home Loans is highly beneficial for those who have fluctuating income and cash flows; mainly businessmen. Fixed income earners can also opt for it in case they are facing a temporary job loss or need urgent monetary assistance. The account is good in terms of liquidity and works just like savings in a bank. A person can withdraw the funds at his/her convenience. He/she can access them anytime. If a person faces a financial emergency, then he/she can choose to withdraw a surplus amount from an Overdraft Home Loan.
Terms and Conditions apply.
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