In the current
scenario, the person will get various options for availing the home loan, such as
housing finance companies, financial institutions and national or private banks, for fulfilling the dream of having own home. If the person is interested in having own
home with home loan, then person should check various factors, which help in getting the best
deal. The various factors are:
1. Check your repaying ability
The customer should check that the person has the ability of repaying the loan amount through EMI. The Emi amount depends upon the loan amount, tenure and interest rate. Normally, banks consider only 30-40% of the net monthly income of the customer, as an EMI amount.
The customer should check that the person has the ability of repaying the loan amount through EMI. The Emi amount depends upon the loan amount, tenure and interest rate. Normally, banks consider only 30-40% of the net monthly income of the customer, as an EMI amount.
2. Look around for the interest rate
The person should compare various lenders before finalizing any lender, so as to avail the lowest interest rate for the home loan. This is because; there are many lenders who provide the home loan. Though, banks levy interest rate according to the loan amount and tenure. It also depends upon the customer’s profile. The banks normally charge an interest rate around 10 to 16%.
The person should compare various lenders before finalizing any lender, so as to avail the lowest interest rate for the home loan. This is because; there are many lenders who provide the home loan. Though, banks levy interest rate according to the loan amount and tenure. It also depends upon the customer’s profile. The banks normally charge an interest rate around 10 to 16%.
3. Loan tenure
The banks provide home loan for the longer duration. The person can avail the home loan for the period of 15 to 20 years. The person should always remember that longer duration results in higher interest amount and lower EMI amount and vice-versa.
The banks provide home loan for the longer duration. The person can avail the home loan for the period of 15 to 20 years. The person should always remember that longer duration results in higher interest amount and lower EMI amount and vice-versa.
4. Loan disbursement
The time involved for the disbursal of the home loan is the total period of processing the application to the amount credit in the customer’s account. Normally, all banks or financial institutions have their own set of time, though usually the lenders take around 7-10 days.
The time involved for the disbursal of the home loan is the total period of processing the application to the amount credit in the customer’s account. Normally, all banks or financial institutions have their own set of time, though usually the lenders take around 7-10 days.
5. Processing fee & various additional charges
The banks charge the processing fee for the processing of the customer’s loan application. The banks or financial institutions usually charge around 0.5 to 4% of the home finance. The person has to pay this fee mandatorily, whether the person loan application is accepted or rejected. This is so; the person has to pay this fee when the customer submits the application form with documents. The person should also check other charges such as late payment charges, prepayment charges and many more.
The banks charge the processing fee for the processing of the customer’s loan application. The banks or financial institutions usually charge around 0.5 to 4% of the home finance. The person has to pay this fee mandatorily, whether the person loan application is accepted or rejected. This is so; the person has to pay this fee when the customer submits the application form with documents. The person should also check other charges such as late payment charges, prepayment charges and many more.
6. Insurance
The government has made it necessary to take insurance cover, if the person has opted for the home loan. This is so; in case of any uncertainty, the liability of the home loan does not come on the shoulder on the dependents of the customer.
The government has made it necessary to take insurance cover, if the person has opted for the home loan. This is so; in case of any uncertainty, the liability of the home loan does not come on the shoulder on the dependents of the customer.
