Why Pay Rent Rather Pay EMI & Move in Your Own Flat. Home loan is a way, which brings you closer to your ‘dream home’. But this is the most delicate kind of a debt as the aspirant pledges one of his most valuable possessions as collateral. The process should start with a thorough study on the home loan procedures, do Compare home loan interest rate with all the leading banks and choose the lowest one. The primary thing to be kept in mind is that the deal should not be finalized with a lender on the basis of cheap interest rates only. But actually, there are various other things that should be kept in mind while applying for it. A prospective loan borrower must not rush while applying for the loan. Here is a defined housing loan guide to direct you in the accurate direction to update you on the home loan offers in India.
At the outset banks would require certain very simple basic documents. Various banks have their own set methods and parameters for appraising a customer. Check your home loan eligibility with various banks. You can but always club your spouse’s income to reach a higher eligibility bracket. The amount of EMI you need to pay per month depends primarily on the loan amount, interest rate and the tenor. The maximum permissible loan tenor for housing loan is 20 yrs. Loan amount of a customer too depends on good income; repayment track record, applicants’ profile, builder profile. Banks offer Home Loan to salaried, self-employed businessman and self –employed professionals. Banks would fund for constructing a home, home extension loan, purchasing a ready built house / flat (from builder or a resale property), residential plot, LAP (Loan Against Property) etc.
Once the property is finalized bank would ask you to submit the property related documents. They would require these documents to confirm that the proposed property is clear and marketable. Availing a Home Loan doesn’t only involve the cost of interest rates but it also includes other charges & fees at various stages. You must consider and compare all these charges while doing a comprehensive study on the cost. Processing fee, a non refundable fee normally charged by all banks for every customer at the very initial stage of home loan application. While signing the loan agreement you need to choose, the type of interest rate you want to pay to the bank. The banks will offer you with an option of a fixed rate or a floating rate. Prepayment fees come in to picture in case one wants to prepay his home loan before the stipulated tenor.
You can avail the Home loans for constructing a home, purchasing a ready built house / flat (from builder or a resale property), residential plot etc. Banks mostly fund 80% to 90% of the real estate value as loan. The customer initially needs to make a down payment (the difference between the actual property cost and the loan amount), on his own. Banks sometimes even fund the registration cost and the stamp duty as a part of home loan. Most of the leading banks provide loan with insurance to protect the family from loan liabilities in case of unfortunate demise of the borrower. Top banks like HDFC, ICICI, Axis, Standard Chartered, CITI,… have attractive Home Loan schemes.