Any amount of money borrowed from a bank or an NBFC for the purchase, expansion, or construction of a home at a certain fixed or floating rate of interest, payable in EMI or Equated Monthly Instalment over an agreed period, is termed as a Home Loan. The property remains as security with the lender for the term or period of the loan. You may avail a home loan for purposes such as:
A vast array of institutions offer you the best home loan rates at the most competitive rates and affordable EMIs.
Types of mortgage and home finance are discussed in brief below
A Home loan happens to be the most common type of loan wherein the house is held as collateral until you repay the loan. Numerous housing finance companies, public and private banks make such offerings with a choice of repayment options.
If you have a plot of land and lack financial support to construct a home on that piece of property, you may choose a house construction loan. Such borrowing is mainly made to construct or repair a major part of your home.
Should you already own a home, and feel the need to extend the building, add an annexe, or build another floor, etc., Home Extension Loan is your go-to option that finances such needs.
All of us wish to improve and upgrade our homes for a better life. From your old-age furniture, fixtures to faulty lightning systems, Home Improvement Loan funds all your plans.
Burdened with high-interest rate debt on your current home loan? Home Loan Balance Transfer lets you transfer your debt to a low-interest rate charging plan to lower your burden and improve your paying capacity.
A Composite Home Loan empowers you to purchase a plot and construct a house as well on the acquired land; both with a single loan and within a stipulated time mentioned by your Bank.
Should you want to move from your present dwelling place to a new dwelling due to professional or personal reasons, you may opt for a Home Conversion Loan. A home conversion loan facilitates the smooth conversion of your current loan from your old home to your new home.
The plan of the Government of India to allow every Indian Citizen an opportunity to own a home in India via the drafting of the Credit Linked Subsidy Scheme or CLSS is known as Pradhan Mantri Awas Yojna. Under the PMAY, a citizen can avail Home Loan from almost all banks allied with this scheme.
If you are a patriot, a Non-Resident Indian, and wish to own residential property in India, NRI Home Loan is your choice. Though the formalities for application may be a little different, you can still get a loan up to a certain percentage of your property value.
Home Loans are Secured Advances, which can be availed by mortgaging the property you seek to purchase. Existing property can also as collateral.
Lenders offer a Minimum Home Loan Value of Rs. 2,00,000 payable in Equated Monthly Instalments (EMIs)
Lenders offer a Maximum Home Loan up to 100% of the Value of your Property
You are offered a Home Loan subject to your income, employment type, credit history, the location of your property, and other factors.
Interest Rates available on Home Loan are of three kinds. Fixed Rate, Floating Rate, Marginal Combination of Fixed and Floating
Lenders offer you a Minimum Home Loan Repayment Period or Tenure of 5 years & a Maximum of 30 years.
Registration charges, processing fees, prepayment penalty, commitment charge, and miscellaneous charges for documentation and consultation, may apply on your home loan.
Depending on the lender you select, you may be offered a home loan pre-payment facility with or without a prepayment charge.
You are entitled to tax benefits on your home loan according to the Income Tax Act, 1961.
You may avail a home loan with your spouse or parent as a co-applicant or a joint applicant, for which you can avail tax benefits too.
Enter your details in the Home Loan Application Form
Furnish your essential documents as asked to further the process
Pay Home Loan Processing Fee
Your Home Loan Application and Documents will be inspected and verified
Your Home Loan Application will be queued and sent for approval or sanction
Your lender will visit the property you intend to purchase for a legal check.
After approval, your Home Loan Amount will be disbursed to your Bank Account
Your home loan eligibility will be determined after considering the prescribed eligibility criteria based on the following parameters
The principal portion and the interest of your loan makes up the EMI or Equated Monthly Instalment of your home loan. In other words, EMI = Principal Amount + Interest Amount. Paid on a monthly basis, the EMI remains constant throughout the period of your loan, when you choose the fixed interest rate method.
Your Home Loan EMI depends on three factors
Use the following mathematical formula to calculate you EMI.EMI = P x r x ( 1 + r ) n / [ ( 1 + r ) n - 1 ]
Most people go for a home loan balance transfer for reasons of reduced interest rates, which in turn lower EMIs, and lead to savings.
When you go for a home loan transfer at lower interest rates, which reduce your EMIs, this may also reduce the overall tenure of your home loan.
Many institutions offer you top up loan facilities when you request a home loan balance transfer. This top up facility may help you pay off your immediate debts to reduce debt burden, or use the same for home renovation purposes.
Check with your lender if there are any additional offers on your home loan balance transfer facility to make the most of a balance transfer.
I got home loan offer from HDFC Limited through Ruloans. Earlier I was choosing some other bank but Ruloans facility of comparison helped me with a better choice. The amount was sufficient with tenure period of 15 years. The rate of interest is moderate. I took this loan to buy an apartment. EMI need to pay 36K. Pre closure is applicable but there is locking period of 6 months. Their service is good.
I have taken home a loan via Ruloans, my loan was sanction on time and it's going to be disbursed soon. The amount of the loan is 18 lakh. The bank informed me that for the construction plan I have to pay 3 lakh. The interest rate is 8.65% but the bank will be reducing the rate by 1.5% from next month. I compared the loan rates and the company helped me select the best one.