What to Keep in Mind while Taking a Housing Loan
Taking housing loan or home loan has become the need of the hour as well as convenience. It is the dream of every person to have a house of his own.
Those who have faced the problems of renting house, they know the meaning of their house very well. Apart from this the rent has gone up a lot. As much as the rent is paid every month, you can enjoy your own house by paying the same amount in the loan installment.
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Government help for housing loan
The government also helps for the house. The rate of interest on housing loan has been greatly reduced. On taking a housing loan, income tax is exempted for its installment installment. This exemption is given under section 80C. Apart from buying a new home, a loan can also be available for some additional construction or modifications to the old house.
Knowing where to take a housing loan and what needs to be done for it makes this task very easy. But it is also necessary to take some precautions, otherwise there may be trouble instead of convenience. Let us know some important things about their relationship –
Where to get housing loan
There are many private and government institutions offering home loans. By contacting whom the loan can be taken. Banks also provide housing loans. Their terms and conditions can be known by contacting the branch. Housing finance companies exclusively do the work of giving loans for houses. Although there is no shortage of lending companies, but some of the main companies are –
- Housing Development Finance Company – HDFC Customer care helpline number
- LIC Housing Finance – LIC HFL Customer care number
- PNB Housing Finance – 1800 120 8800 – PNB HOUSING Customer care number
- India Bulls Housing Finance – IBHFL Customer care helpline number – 1800 572 7777
- Dewan Housing Finance – DHFL Customer service phone number
Some institutions give special facilities to special people like interest rate may be lower for women. Information about such facilities can be obtained from the branch.
Housing loan for how many years
Each institution may have different rules in this regard. In general, a home loan can be granted for a maximum tenure of up to 30 years. You can take the loan for as long as you can repay the loan as per your convenience. Like 5 years, 10 years, 15 years, 20 years or 30 years.
The rate of interest may vary depending on the tenure of the loan and the amount of the loan. If you want, you can also get the installment stopped by paying the entire loan amount along with interest ahead of time. Some organizations charge it separately and some do not. Complete information should be obtained from the organization regarding these.
A processing fee may be charged by the financing institution to process the loan. Which is 0 of the loan amount. Can range from 5% to 1%. This amount can be recovered by adding it to the loan amount. Some organizations give exemption in processing fee, it can be taken advantage of.
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home loan how much
How much one can get a home loan depends on your monthly income, your spouse’s monthly income, your property assets, liability liabilities and stability of income.
The lending institution ensures that you will be able to repay the loan on time or not. The loan amount can also be decided according to your age. You should take as much loan as you can easily repay the loan amount. To get the loan amount, you need to provide your income details.
what is a down payment
When you take a loan, you have to pay some amount. For example, if you want to buy a house of 20 lakhs, then you will have to pay 2 lakhs, the remaining 18 lakhs will be available as loan. This amount of 2 lakhs given by you is called down payment.
If you are considered suitable for the loan, then the loan amount can be 80 to 90% of the total value of the house. Every organization has its own rules in this regard. Generally, it also includes the amount of registration and stamp duty etc. It should be found out whether it is so or not.
Try to keep the amount of the down payment as high as possible so that you have to pay interest on the lesser amount.
Which paper for housing loan
The following documents can generally be asked from you along with the form for housing loan –
Copy of salary slip (which shows your monthly salary) if you are employed.
Copy of Income Tax Return if you are self employed or self employed.
Copy of trading account and balance sheet etc. related to the business.
Your bank account statement.
– Your photograph.
ID Proof like Aadhar Card, Voter ID Card, Pan Card, Ration Card, Passport etc.
Residential proof such as electricity bill, rent debit, landline phone bill etc.
Some organizations may demand collateral security such as insurance policy, shares, NSC, mutual funds, bank FD or other investment related documents etc.
Senction of Loan
On the basis of the documents given to the institution, it is considered whether you are eligible to get the loan or not. The loan amount is also decided on the basis of these documents.
If you are found eligible, then you are informed about it through a letter in which the loan amount, its tenure, rate of interest and other terms are written. How long and how these terms will be valid is also told. This is called having a loan sanction or getting a sanction letter.
fixed or floating interest rate
Housing Loan The rate of interest on home loan can be fixed or floating. These loans are of long tenure so it is important to decide whether you want to take a fixed interest rate loan or a floating interest rate loan. Fixed and floating interest rates are as follows –
Fixed interest rate – Once fixed, the interest rate remains the same for the entire tenure of the loan. Even if there is a change in the interest rate by the government, the same interest rate is levied on the loan which is fixed at the time of giving the loan. Some institutions keep the rate fixed only for a certain period of time and then convert to floating.
Floating interest rate – Interest rates can be changed by the government over time. If the financing institution wants, then you can change the interest rate of the loan taken by you. That is, if the interest rate has come down then your institution can also reduce the interest, and in the same way if the rate of interest increases then you can be charged more interest.
If you think that the interest rates may come down in the coming time, then you should take a floating interest rate loan and if you think that the interest rates will increase in the future, then you should take a loan with a fixed interest rate.
What is EMI?
To withdraw the loan amount, a fixed amount is decided by the institution which is taken every month. This amount includes the amount for both the principal amount and the interest. This amount taken as installment installment every month is called EMI.
EMI starts from the next month after the loan amount is received from the institution. When the EMI installment is paid, this amount is deducted from the loan amount and interest is charged on the remaining amount.
Things to keep in mind while taking a housing loan
housing loan tips
Take a home loan from where the EMI is lowest for the same tenure. Be sure to do your math with the full confidence of an agent.
If you can repay the loan early, do not take a loan for a longer tenure. The longer the tenure, the more interest you have to pay. The maximum tenure of the loan can be up to 30 years.
The longer the tenure, the lower is the EMI. This can lead to attraction. But it is harmful for you.
It should be ascertained whether there are any additional charges for premature repayment of the loan amount.
Check whether the amount of furnishing is included in the home loan or not.
A finance company that takes interest on the amount decreasing daily or month wise should choose to take the loan and not the one that takes interest on the decreasing amount according to the year.
When the loan amount is being disbursed, you can request for a lower amount if you wish.
You should take the loan as much as you can easily repay. As a thumb rule, all your loan installments together should not exceed 50% of your monthly income.
It should be kept in mind that the installment of any loan is being given on time. Otherwise, there may be trouble in taking another loan for some other requirement.
– There may be legal changes regarding the loan over time. Therefore, keep in mind that if you get any benefit from the change in law, then you should take advantage of it immediately.
Before taking a loan, one should definitely consult with the family members. Because the effect of repaying the loan comes on all the house holders. Your life partner must be made aware of this. for more other information visit Mylargebox.
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