You want to revamp your kitchen, extend a bedroom, or finally give your home the facelift it deserves. But when it comes to financing a renovation in 2025, you’ve got two choices:
👉 Home Renovation Loan
👉 Personal Loan
So, which loan is better for your needs? Let Vizzve Finance help you compare and choose smartly.
🧾 What Is a Home Renovation Loan?
A home renovation loan is a type of secured loan specifically meant for home improvements. It's typically offered to homeowners who want to renovate their existing property.
✅ Key Features:
Lower interest rates (compared to personal loans)
Based on property ownership
Can be part of your existing home loan
Possible tax benefits under Section 24(b)
💰 What Is a Personal Loan?
A personal loan is an unsecured loan, meaning you don’t need to pledge collateral. You can use it for anything, including home renovations.
✅ Key Features:
Faster disbursal
No collateral required
Shorter tenure (1–5 years)
Slightly higher interest rates (11–24% p.a.)
📊 Side-by-Side Comparison: 2025 Edition
| Feature | Home Renovation Loan | Personal Loan |
|---|---|---|
| Collateral | Required (property) | Not required |
| Interest Rate (Avg.) | 8.5% – 11.5% | 11% – 24% |
| Tenure | Up to 15 years | 1 – 5 years |
| Loan Amount | 80% – 90% of cost estimate | ₹50,000 – ₹25 lakh |
| Processing Time | Slower (5–10 days) | Faster (24–72 hours) |
| Tax Benefits | Yes (Sec 24b – ₹30,000 max) | No |
| Best For | Major structural renovations | Small upgrades or quick fixes |
🏠 When Should You Choose a Home Renovation Loan?
✔️ You own the property and have documents
✔️ You’re doing major structural changes (roof, plumbing, flooring)
✔️ You want lower EMIs & longer repayment
✔️ You’re already a home loan customer with the same bank
🚿 When Should You Choose a Personal Loan?
✔️ You need money urgently
✔️ The renovation is small to mid-sized (painting, modular kitchen, furniture)
✔️ You don’t want to risk collateral
✔️ You want flexibility in how you use the funds
📢 Vizzve Insight: Tax Benefit Tip
You can claim up to ₹30,000 in interest deduction under Section 24(b) of the Income Tax Act for home renovation loans—only if linked to your property.
No tax perks on personal loans used for renovation.
🧠 Pro Tips Before Applying
🧾 Get cost estimates from contractors to determine accurate loan amount
🏦 Compare multiple lenders via Vizzve for best rates
🧮 Use Vizzve’s EMI calculator to plan smartly
🔒 Don’t borrow more than you can comfortably repay
❓ FAQs – Home Renovation vs. Personal Loans in India 2025
Q: Can I get a home renovation loan without an existing home loan?
A: Yes, but you'll need to prove ownership of the property.
Q: Which loan is better for ₹2–3 lakh renovation?
A: A personal loan is faster and better suited for smaller renovations.
Q: Will banks ask for renovation proof?
A: Yes. For home renovation loans, you may need to submit invoices or quotes from contractors.
Q: Can I prepay either of these loans?
A: Yes, but check prepayment charges with your lender.
✅ Vizzve Final Word
🏠 If your renovation is large, planned, and property-linked — go for a home renovation loan.
⚡ If it's urgent, quick, and under ₹5–10 lakh — opt for a personal loan.
No matter which one you choose, Vizzve Finance helps you compare rates, simplify paperwork, and stay financially stress-free.
Your dream home makeover starts with a smart loan decision.
Published on : 18th July
Published by : SMITA
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