Home Loan for House Renovation

Renovating a home takes both planning and money, and a home renovation loan makes it easier for homeowners to repair, upgrade, or improve their house without spending all their savings. These loans, also called home improvement loans, home remodel loans, or loans for home repairs, can be used for things like painting, flooring, kitchen or bathroom upgrades, structural changes, or even a full renovation. A home reno loan is a type of Home Loan specifically for improving an existing house and can be taken on its own or as part of a home and renovation loan. The loan amount depends on your income and the property’s value, with repayment periods usually between 20 and 30 years. Interest rates generally start around 9% and are lower than personal loan rates, which makes it a simple and affordable way to give your home a fresh look.

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Table of Content

1. What are the Eligibility Criteria for Home Renovation Loan?

2. What are the Benefits and Features of Home Renovation Loan?

3. What are the Documents Required For a House Renovation Loan?

4. Home Renovation Loan Fees and Charges

5. Government Schemes for Home Renovation Loan

  • 5.1 Pradhan Mantri Awas Yojna
  • 5.2 Dr. B.R. Ambedkar Awas Navinikarn Yojna
  • 5.3 HUDCO Niwas
  • 5.4 Maharashtra Housing and Area Development Authority Scheme (MHADA)

    • 6. Home Renovation Loan Offers

    Read more
    Written By
    Drishti Katyal
    Drishti Katyal
    Driven by a fascination with how people manage their money, Drishti turns complex financial topics into clear, relatable stories. She enjoys exploring the decisions that quietly shape everyday finances. When she’s not writing, she’s mapping out her next travel adventure, seeking out new experiences or experimenting with fresh ideas that spark her curiosity.
    Reviewed By
    Amit Prakash Singh
    Amit Prakash Singh
    Co-Founder, Square Yards & Chief Business Officer, Urban Money
    Amit Prakash Singh is the Chief Business Officer at Urban Money. With over nine years of experience at Square Capital, he has played a crucial role in establishing it as one of India's premier loan advisory services. Amit's deep financial insights and extensive knowledge have driven significant business growth and strategic advancements. He has successfully built and managed large sales teams, optimised costs, and created leaders within the industry. Amit's financial expertise and strategic vision are key to the ongoing success and expansion of Square Yards and Urban Money.

    Last Updated: 28 March 2026

    What are the Eligibility Criteria for Home Renovation Loan?

    To apply for a home renovation loan, applicants must meet certain eligibility criteria set by lenders, which mainly focus on income stability, credit profile, and ownership of the property being renovated. Use a home loan eligibility calculator to assess your profile in advance.

    Criteria Details
    Nationality Must be an Indian citizen
    Age Limit 21 to 65-70 years (varies by lender)
    Employment Type Salaried or self-employed
    Minimum Income ₹20,000/month (salaried) or ₹2.5 lakh/year (self-employed)
    Credit Score 650-750+ preferred
    Property Ownership Applicant must own the house
    Work Experience 2-3 years minimum
    Repayment Capacity Based on EMI affordability

    What are the Benefits and Features of Home Renovation Loan?

    A home improvement loan comes with many advantages:

    • Lower interest compared to personal loans
    • Flexible repayment tenure
    • Quick approval from major home renovation lenders
    • Can cover all types of loans for home repairs
    • Tax benefits available under certain conditions
    • Option to combine with existing Home Loan

    If you compare options, you can find the best home renovation loans or best home improvement loans with suitable EMI plans using a Home Loan EMI Calculator.

    What are the Documents Required For a House Renovation Loan?

    To apply for a house renovation loan, applicants need to submit a set of documents for identity verification, income assessment, and property validation to ensure smooth loan processing.

    Document Type Required Documents
    Identity Proof Aadhaar Card, PAN Card, Passport
    Address Proof Utility bills, Aadhaar, Passport
    Income Proof (Salaried) Salary slips (last 3 months), Form 16
    Income Proof (Self-employed) ITR (2-3 years), business proof
    Bank Statements Last 6 months
    Property Documents Ownership proof, title deed
    Renovation Estimate Cost estimate or contractor quotation
    Photographs Passport-size photos

    • Home Loan EMIs Based on Different Budgets

    Home Renovation Loan Fees and Charges

    Home renovation loans come with certain fees and charges that vary by lender, covering processing, legal verification, and other administrative costs associated with the loan.

    Charges Type Details
    Processing Fee 0.25% -1% of loan amount
    Documentation Charges Basic paperwork cost
    Legal & Technical Charges Property verification and inspection
    Prepayment Charges Usually NIL for floating rate
    Late Payment Charges Penalty on delayed EMI
    Conversion Charges Fee for changing interest rate

    Make use of the home loan prepayment calculator to also plan for an early loan closure. This way you are reducing your liability to pay more interest.

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    Government Schemes for Home Renovation Loan

    Pradhan Mantri Awas Yojna

    Pradhan Mantri Awas Yojna, or PMAY-Urban, is a government scheme introduced in 2015. This scheme offers home loan interest rate subsidies to the residents of India. Features of this scheme also include economic growth, quality life improvement, affordable loan prices, implementation area, etc.

    Dr. B.R. Ambedkar Awas Navinikarn Yojna

    This scheme is available for residents of Haryana only. Individuals who fall below the poverty line can avail of this scheme for home improvement. This scheme requires the applicant to own a house for at least 10 years.

    HUDCO Niwas

    The Housing and Urban Development Corporation (HUDCO) offers home improvement loans at affordable interest rates for house improvement or renovation purposes. HUDCO Niwas offers loan amounts up to Rs. 1 Crore and a maximum of 25 years as a loan term.

    Maharashtra Housing and Area Development Authority Scheme (MHADA)

    MHADA runs a house renovation plan to work with reasonable living for everybody. The plan is worked through a lottery framework. A specific number of houses are saved for the MHADA renovation plan. House improvement loans are available for applicants who have a house with various repayment plans depending on lottery draw results. These houses cost between ₹15.35 Lakhs and ₹1.42 crore.

    Home Renovation Loan Offers

    Below are some of the home renovation loan offers from various reputed banks and NBFCs:

    Bank Name Interest Rate (p.a.) Processing Fee Key Features
    State Bank of India 7.25% – 8.70% ~0.35% (₹2,000-₹10,000) Low rates, no prepayment charges
    HDFC Bank 7.90% onwards Up to 0.50% Flexible EMI, quick processing
    ICICI Bank 7.65% onwards Up to 0.50% Fast approval, digital process
    Axis Bank 8.30% – 9.70% Up to 1% Easy eligibility, quick disbursal
    Bank of Baroda 8.15% – 10.65% 0.25% – 0.50% Competitive rates, public bank trust

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    Frequently Asked Questions (FAQs)

    What is a home renovation loan?

    A home renovation loan is a type of Home Loan used for repairing, upgrading, or improving an existing house.

    How to get a home renovation loan?

    You can apply through banks or NBFCs by submitting income and property documents. You can also apply for a home renovation loan online through Urban Money.

    How to get a home improvement loan?

    Check eligibility, compare home improvement loan interest rates, choose a lender, and submit required documents.

    Can you get a loan to fix up a house?

    Yes, banks offer house repair loans and loans for home repairs for renovation work.

    How to get a loan to renovate your home?

    Choose between home remodel loans or home and renovation loans, apply through Urban Money, and get approval based on eligibility.

    Which loan is best for home renovation?

    The best home renovation loans are those with low interest rates, flexible tenure and low processing fees. One should compare multiple options before deciding.

    How to apply for a home renovation loan?

    Borrowers interested in a home loan for house renovation can apply via Urban Money. They can simply go the website and under the home loan section, provide their contact information. An Urban Money loan representative will contact you for further assistance.

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