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19 things you should consider when taking up a home loan in India

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19 things you should consider when taking up a home loan in India 2018

19 things you should consider when taking up a home loan in India 2018

Here is a list of main topics that attract your attention:

Your Finances – What is your Gross Monetary Income? How is my credit

Get to know the ways were you can avoid down payment!

6 ways on how to Buy a House without Having Money for Down Payment in 2018?

 

 CREDIT HISTORY – Banks always like people with clean financial habits. The credit score tells a lot about your financial health. You can easily check your EMIs on time or default through your credit report, which is managed by various bureaus.

OCCUPATION – There are some jobs that banks like. For example, employees of several government banks, public and government employees are very stable and they have a steady job

AGE – Another criterion to look forward to your age when giving a loan. Since you are more economically stable for people aged between 30 and 50, you may want to give a thought to yourself.

DISTANCE – Banks take distance into account while approving a loan the property must belong to the nearest city and within the same manual that means it should meet the requirement of housing and development needs.

WORK EXPERIENCE – You need to know that banks are asking for how many years you work with your current organization. Because you are serving more points earned by the bank i.e Banks prefer people working in an organization for at least three years.

INCOME SOURCE – If you are planning to buy a property worth 1 crore but your income will not match your current requirement then banks force you to choose the lesser one

The rate of Interest – This is the single biggest factor when a home loan is taken. The low-interest rate, it’s fine. If the interest rate is low, pay a monthly interest rate each month and pay moreOn the month’s formula.
The low-interest rate can also reduce monthly payment or EMI. Less EMI is easy to pay.
The lower interest rate also means that you are eligible for the maximum loan amount given to the income level.
Remember that the rate of interest is higher in fixed-rate loans than floating rate loans.

REPAYMENT PERIOD – The less repayment period, the more your bank likes. For example, many banks give the maximum number of people who are opting for a refund period of up to five years. If the repayment period is between 10 and 15 years it comes up to half. And it is at the lowest end of that choice for a period of 15-20 years. So, next time, try to reduce your debt period if approval becomes harder.

RELATIONSHIP WITH THE BANK – Banks value their old customers a lot because they are very satisfied and loyal customers for an extinct a person who has a bank account of 10 years in the same bank will be preferred more and the chances of getting a loan are more likely. ” HDFC Home Loan Interest rates 2018

PURPOSE OF THE LOAN – Before you apply for a loan it is needed to understand the risk factor associated with the loan suppose a loan for under construction is risky because there will be a delay from builder etc. To understand risk factor associated with the loan.

Down Payment – Each bank asks for a certain amount as a down payment. (By this banks come to conclusion that the person who has applied he does not rely on the loan completely he has some savings).This down payment is less than 0% in special cases – for example if a builder tied with a bank for his entire project. But in most cases, the down payment is between 10-15%.This means you need to give this amount in advance. Due to a large number of home loans, 15% are also struggling.

Calculation of interest daily, monthly, quarterly and yearly – It again affects how much you pay for the loan interest. This factor is not the most important these days, as most banks count interest in daily or monthly intervals. But before you finalize your home loan provider, confirm this.

Read more about- RBI guidelines for Home Loan balance transfer charges

Is there any loan processing fee – Banks charge “processing fees” to process your home loan application. This is a percentage of the home loan amount and is usually 0.5%. This will be charged regardless of your home loan approval or denial. So go for the bank that has a low processing fee.

Time takes to approve the loan – As your bank regarding the time that takes it to disburse the loan because nowadays most of the PSU banks takes time.

Prepayment Penalty – Get it conformed with bank whether there is any prepayment penalty. Suppose you may get an unexpected bonus or a chit that got matured so you have a lump sum amount so get that clarified before.

Foreclosure Penalty – Same way conform with bank authority whether they charge any money while we pre-close the loan before the tenure. If yes, then ask them the percentage of the amount they need to pay.

The requirement of a Guarantor – Some banks, especially PSU banks, want to provide a guarantee for home loans. Everyone will be in a position to find someone with a good financial position to back up their home loan. So, this is a very important consideration.

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