5 Tips to keep in mind before taking a Home Loan
The importance of a home loan cannot be underestimated for a large chunk of home buyers depend on it for financing their dream home.
The importance of a home loan cannot be underestimated for a large chunk of home buyers depend on it for financing their dream home. However, since a home loan is a liability that has to be repaid to a bank or a financial institution within a specified time, it is important that the decision is taken thoughtfully. The bank from which loan is taken, the rate of interest on the loan, and repayment tenure are some of the things one must research thoroughly.
In this article, we talk about some important tips you should keep in mind before taking a home loan:
1. Research: One should perform a good research about the available home loan products in the market. Do not trust advertisements or agents blindly. Also, never feel shy about clarifying your doubts from the agent as it will impact your life in the near future.
2. Have a look at the EMI (Equated Monthly Installments): Analyze your incomes and expenditures properly to decide how much amount you can spare on a monthly basis for your home loan EMI. Talking to a qualified agent to ascertain the same also comes handy.
3. Never forget to negotiate: As we all know that the ROI (Rate of Interest) offered by the financial authorities is fixed but there is always some scope for negotiation. So, try negotiating the rate of interest so that you can save a few thousand on the total amount to be paid.
4. Loan Eligibility and CIBIL Score: Make the required documents handy which include your information about your credit card and your history in paying your debts. If you have a good record of paying your debts, then you can use it as a plus point when applying for a loan. Ideally, your CIBIL score should be 750 or more to get a lesser ROI on your home loan.
5. Read the documents very carefully: One must read all the documents pertaining to the loan document with a keen eye as there are chances that the agreement might miss some points on which you negotiated with the agent or the financial authority. The more you are aware of the terms and conditions, the better it is for you.
To avoid faltering with your home loan, make sure you keep these things in mind before applying for it and signing the dotted line.
Tip #1 – Start saving for a down payment.
Tip #2 – Check your credit score.
Tip #3 – Get your financial documents in order.
Tip #4 – Utilize a mortgage calculator.
Tip #5 – Learn how to compare offers.
Tip #6 – Start tracking interest rates.
Tip #7 – Get pre-qualified.
With all the aforementioned points in mind, seeking a home loan becomes much more simplified. In India, the best bank that offers home loans are SBI Home loans, LIC Housing, HDFC Ltd, ICICI Bank, DHFL Housing, Axis Bank, Bank of Baroda, and many more.