Buying a home is a big decision, and most people take out a home loan to make it possible. But when it comes to extra expenses like registration, interiors, or repairs, your savings may fall short. That’s when many people think of taking a personal loan to cover those additional costs.
But can you take a personal loan if you already have a home loan? The answer is yes, but it depends on a few important things like your credit score, income, and ability to repay.
Let’s understand how personal loans and home loans can work together, what you need to be careful about, and how to plan smartly if you want to manage both loans at the same time.
Key Difference Between Home Loan and Personal Loan You Should Know
Before you take both loans, it’s important to know how they work differently.
✅ Home Loan: Long-Term and Secured
- A home loan is taken out to buy a house or a flat.
- It is a secured loan, which means your property is kept as security with the bank.
- Since it’s secured, interest rates are lower.
- The repayment time is long, usually between 15 to 30 years.
- EMI is usually lower due to the long repayment period.
✅ Personal Loan: Quick and Unsecured
- A personal loan is not linked to any asset.
- It is an unsecured loan, so you don’t need to give any property as a guarantee.
- Interest rates are higher compared to home loans.
- Loan tenure is shorter, between 1 to 5 years.
- Money gets approved and credited faster.
Can You Take a Personal Loan If a Home Loan is Already Running?
Yes, you can. Lenders usually check your credit score, EMI history, income, and overall repayment ability. If you have been paying your home loan EMI on time, your chances of getting a personal loan are good.
Many people take both loans at the same time, especially if they have planned their finances well. But lenders will give the green signal only if your financial records show that you can handle both EMIs comfortably.
Key Points to Check Before Taking Both Loans
If you are planning to take a personal loan while paying off a home loan, these are some important things to keep in mind:
🔹 Maintain a Good Credit Score
- A credit score of 700 or more increases your chances of getting a personal loan.
- Always pay EMIs on time and avoid too many loans or credit cards.
🔹 EMI to Income Ratio Should Be Low
- Your total EMIs (for home loan + personal loan) should not be more than 50% of your monthly income.
- If this ratio is high, the lender may reject your loan request.
🔹 Use an EMI Calculator
- Before applying, use an EMI calculator to check how much EMI you can comfortably pay.
- Plan your loan tenure and EMI amount in a way that suits your monthly budget.
🔹 Think About Joint Loan
- If your income is low, you can apply for a joint personal loan with your spouse or a family member.
- This increases the total income, making it easier to get loan approval.
🔹 Check All Charges and Conditions
- Look beyond the interest rate.
- Also check processing fees, pre-payment charges, and penalties for late payment.
- Choose a lender with simple terms and minimum hidden charges.
Why People Take Personal Loans Along With a Home Loan
There are many practical reasons for combining a personal loan with an existing home loan:
- You need money for home interiors or renovation.
- Legal and registration fees need to be paid separately.
- Some people use personal loans to buy furniture, appliances, or fittings.
- In some cases, a medical emergency or other urgent need arises while paying a home loan.
Instead of breaking your investments or using all your savings, a personal loan can help you stay financially stable.
What Are the Risks of Managing Two Loans Together?
While it is possible to manage both loans, it needs discipline. If you don’t plan well, there are risks:
❌ Higher EMI Load
Managing two EMIs every month can be tough. If your income reduces or you lose your job, repaying both loans will become difficult.
❌ Credit Score May Drop
Missing any EMI or delaying payments will bring down your credit score. This will impact your chances of getting any future loan.
❌ Risk of Debt Trap
If your expenses keep increasing and you take more loans to pay EMIs, it can lead to a debt trap. That’s why planning is key.
Simple Tips to Stay Safe While Taking Both Loans
If you want to manage both loans without stress, follow these basic rules:
- Set a monthly budget and follow it strictly.
- Avoid unnecessary spending until you repay one of the loans.
- Keep an emergency fund equal to at least 3 months’ EMI.
- Talk to your lender if you face any trouble. Some lenders allow EMI breaks or restructuring of loans.
- Choose the auto-debit option for EMIs so that you don’t forget any payment.
Where to Get a Personal Loan Without Much Hassle?
Today, getting a personal loan has become fast and easy. Platforms like Moneycontrol have tied up with 8 top lenders to offer 100% digital personal loan services. You can get up to Rs. 50 lakh loan in just a few steps, with minimal paperwork.
Here’s how it works:
- Enter your basic details
- Complete your KYC
- Choose your EMI plan
- Get the loan amount credited quickly
- Interest rates start from 10.5% per annum
This option is especially helpful for people already handling a home loan, as the process is quick and less complicated.
Final Thought
Taking a personal loan when you already have a home loan is not a bad idea, but only if your income allows you to handle both EMIs without trouble. Think practically, calculate carefully, and avoid unnecessary borrowing. If done with proper planning, both loans can help you meet your goals smoothly and also improve your credit profile for the future.
