A home serves various purposes. The owner can live with their family or alone. They can rent it to earn a fixed income every month. Moreover, they can sell it and get the money instantly. In addition, they can use it as collateral to apply for a loan against property.
Since the cost of house construction or purchase is immense, people rely on home or housing loans to fulfil their dreams. Moreover, a home loan saves you from emptying your bank account since you can conveniently repay small amounts every month and get ownership rights.
Because home loans are a long-term liability, it is wise to evaluate the pros and cons before availing of the best housing loan in India. This article contains the nine best tips you need to find the best housing or home loan rates and secure a quick approval.
Below are the Techniques to Find The Best Housing Loan:
1. Increase Your CIBIL Score
To reduce the chances of loans becoming NPA (Non-Performing Asset), lenders carefully evaluate borrowers’ CIBIL scores. CIBIL score typically ranges between 300 and 900, and any score above 750 is considered decent. The CIBIL score not only affects the home loan rates but also the approval. Hence, if your credit score is below 750, try increasing the score to get the best housing loan in India.
2. Increase the Downpayment Amount
The minimum downpayment for availing of the best housing loan in India is 10% of the loan amount. The actual loan amount is usually 90% of the house’s market value. However, if you increase the downpayment slightly, your net liability will reduce substantially. This will also result in a reduced EMI, prompting the lender to offer you the home loan rates.
3. Keep Your Financial Documents in Shape
When you apply for the best housing loan in India, the lender asks you to furnish your income proof. The income proof shows your repayment capability. Sometimes, lenders set a minimum income threshold to get loan applications from qualified borrowers. The documents you must keep ready include your appointment letter, 3 months’ salary slips, Profit & Loss statement (for self-employed), ITRs, and 6 months’ bank account statement. Keeping these documents in order can help you save crucial time when your lender calls you for document verification.
4. A Home Loan EMI Calculator Can Help You Stay One Step Ahead
Using a home loan EMI calculator is a must before applying for the best housing loan in India. An EMI calculator needs three details – loan amount, tenure, and rate of interest – to show you the EMI amount. Proper knowledge of the EMI can help you understand your financial capability and choose the right loan amount. When the lender feels convinced about your repayment capability, they won’t mind offering you the best home loan rates.
5. Choose The Interest Type Wisely
Home loan rates may be fixed or floating. A fixed-rate loan’s EMI and tenure remain the same throughout the loan term. In contrast, a floating-rate home loan’s tenure changes depending on the interest rate. If the interest rate increases, the tenure increases as well and vice versa. So, you must convey your desire to the lender while choosing the best housing loan in India.
6. Compare Lenders
The best housing loan in India is the one that offers you complete peace of mind. When you apply for a home loan to buy or construct a home, you need to pay various charges, such as processing fee, valuation fee, downpayment, stamp duty, registration fee, etc. All of these increase the actual cost of house construction or purchase. The best lender not only offers the best home loan rates but also levies lower fees. So, you can save an extra amount by comparing lenders until finding the best one.
7. Choose a New Lender
Sometimes, lenders offer exclusive discounted home loan rates to new customers. Also, they offer deep discounts during the festive season. You may approach a lender during such times to manage additional savings. However, before approaching a new lender, ensure to consult the financial institution you already maintain an account with to check whether they can match or outsmart the new lender or not.
8. Be Consistent With The Credit Score
It is vital to be consistent with the credit score after applying for the best housing loan in India. Although lenders check the credit score when you apply for a loan, they can also check it later eCommerce Marketing Chicago. So, you must be consistent with loan repayments and clearing credit card dues to keep your credit score high.
9. Sign the Loan Documents After Reading Everything
Signing the loan documents is a mandatory exercise. But, ensure you have gone through the terms and conditions before signing the loan agreement. Once you sign the documents, it is considered legal and binding.
The techniques mentioned above can bring you one step closer to the best housing loan in India and further close to your dream of owning a house. Keep these tips in mind to apply for a home loan like a professional.