Having your own home with a favored balcony is somethineveryone aspires of. However, the easiness and flexibility of home loan have actually made that possible. It is taxing as you take a home loan you have to reserve a portion of your income every month to repay the loan. But the advantage is that you can extend that for a period of 30 years at the most. Hence will give you hints on how to choose the right home loan.
Consider loan eligibility, calculate EMI of home loan and time span
While calculating the EMI you should consider your limit and comfort. That is why make sure to pay the rate within 60 to 65% of the amount. Next, you should verify the eligibility of the loan after considering your age and the EMI. Always do rely on loan designed for the short time span. Moreover, you get the benefit of including three more earning members of your family as well. Overall, confirm that the loan amount should be within 70 to 80 % of the market worth.
Status of approval of the Asset
The bank does not approve a home loan of random properties. Majorly the builders need to resort to two types of funding schemes like the Term link plans and the construction link plans. The bank grants approval mostly for the construction link plans. Next, you have to consider the comprehensive expenditure of the flat like the electric charge, basic charges, IDC, EDC, PLC, parking, registration, stamp duty, maintenance and many more. Then you have to pay heed to the time duration for deed registration. Additionally, make sure that the developer receives all the necessary payment via cheque only.
In the case of reselling asset, just verify that the property should have the registration on the name of the seller. If the individual himself constructs the property then he needs to submit the properly approved plan of the map. However, you will not get any fund on property located under the jurisdiction of Gram panchayat.
Choose the home loan floating or fixed
The floating loan rates are much preferred compared to the fixed one. This is because somewhere down the line the rate will decrease and one does not need to pay the charge for the prepayment. However, the fixed loan rate is also preferable if you consider that your monthly income is not adequate to take up the extra load. Remember mostly the banks follow the fixed-rate initially but later they convert that into the floating rate. Suppose if the entire span of the loan is for thirty years, then the fixed loan will vary between one to 10 years only.
Check the prepayment and foreclosure charges:
You need to get in touch with a bank, which permits prepaying the loan. But as per RBI they cant impose the penalty. However, if you prepay the loan based on fixed-rate then they might ask you 1 to 3% of the charge.
Choose a convenient bank:
Lastly, you need to choose the right bank for that to go through the customer reviews and ratings. These are the few guidelines, which you have to follow to get a home loan.