When you want to manage your unplanned expenses, you can easily access additional funds with the help of the home loan overdraft service. The only condition is that you need a continuous mortgage loan with your bank to take advantage of this service. Read more to learn more in detail.
If you have obtained a mortgage loan from any bank or financial institution, you are already obliged to repay the loan amount. There may be times when you lose your EMI coupons and need instant funds for certain financial needs. In such circumstances, you can take advantage of an overdraft on an existing home loan, which can help you meet a short-term financial need. For example, ICICI Bank offers a home loan overdraft service as a supplemental loan to an existing home loan, a real estate loan, or a loan against rental receivables.
What is an Overdraft Home Loan?
Do you need instant cash to finance emergencies? Home Overdraft Facility is a simple solution to your financial problems. The product is offered to borrowers, allowing them to withdraw or withdraw money from a checking or savings account or current account and pay interest only on the amount used. Apply for the OD service available in the form of a home loan overdraft from ICICI Bank. It has all the characteristics of an unsecured loan.
Let’s understand the features of a Home Loan OD:
- Flexibility to withdraw funds at any time, when needed
- Get an overdraft limit of up to 90% on your home loan
- Pay interest only on the amount used
- You can take advantage of the reverse wipe feature when funds are transferred from the OD facility to a savings account for withdrawals
- Get your overdraft limit, with the monthly drop-down menu selected. This means that withdrawing the amount from the OD account each month reduces the penalty limit.
- There is no lock-in period, as borrowers can close the overdraft account at any time.
Eligibility criteria for an Overdraft Home Loan:
- The bank assesses the borrower’s financial condition to determine the overdraft limit.
- You can avail the loan amount ranging from Rs 5 Lakhs to Rs 5 crore
- Salaried individuals and the self-employed can apply for the loan; However, the loan amount may vary, depending on the profile of the borrower.
- You can use the overdraft loan for both business and personal needs.
- Mortgage overdrafts are very beneficial for those with fluctuating income and cash flow; Mainly businessmen. People with fixed incomes can also opt for it, In case, they are facing temporary job loss or need urgent financial assistance. The account is good in terms of liquidity and works like savings in a bank. Anyone can withdraw money at their convenience. You can access it at any time. If a person faces a financial emergency, he may choose to withdraw an excess amount from the overdraft loan for the home.