Tuesday, August 28, 2018

7 Crucial Things to Remember While Applying for a Home Loan

Buying your own house is like a dream come true. You get to enjoy the comfort and security of your own home. Moreover, you don’t have to worry about your landlord’s unnecessary restrictions, complaints, and rent negotiations. 

However, purchasing a house can be quite stressful due to the rising prices of the property. But don’t worry, we have listed a few things to remember before applying for the home loan:

1. Check your CIBIL score:

Before you apply for a home loan, you need to make sure that you have a decent CIBIL score.A score of 650+ is considered suitable for a home loan.If your credit score is good,banks will offer a loan at attractive interest rates.

Moreover, you may get financing up to 80-90% of the total cost of the property, if you have a good credit score. But in case there is a mistake in your credit report, tell the concerned authorities.

2. Compare interest rates: 

Before applying for a home loan, it is better to compare interest rates across various lenders. Interest rates can differ widely from lender to lender, so explore your options. 

Also, compare interest rates,maximum tenure,eligibility,processing fee and various other factors offered by different lenders. Banks and NBFCs such as Axis Bank, Citibank, HDFC, and ICICI Bank offer home loans at a lower rate of interests.

3. Additional charges:

When you are applying for a home loan, you need to be educated about the various other charges that the lenders add to the current schemes.

They will add administrative and service charges or processing fees. So before you finalize any deal, you should make note of such additional charges that the lenders ask from you.

4. Calculate EMI:

Use online Home Loan EMI calculator to know how much EMI you can afford to pay every month on the borrowed loan amount. Various banks and websites of online marketplaces like MyLoanCare have their personal EMI calculator which allows you to calculate your monthly EMI based on different loan amount, interest rate and tenure.

You can calculate the EMI amount to know how much money you have to repay every month comfortably with the income you are earning.

5. Keep your documents ready:

Keep all the important documents ready and in order before applying for a home loan. This will help to speed up loan processing. The important documents that you need to submit are: KYC documents, income proofs, bank statements and property documents.

6. Read the fine print of the agreement carefully

Read your home loan agreement carefully. Sometimes, lenders may verbally agree to certain points but in the end whatever is present on the paper will only be taken into consideration. 

So it is best if you could just spend some extra time reading the document carefully rather than getting stuck in complications later on. Never sign on a blank loan paper even if the salesperson asks you to do so.

7. Never leave a doubt

Ask questions if you have any doubts, because it is very important to be aware of every term and condition mentioned in the loan. For your satisfaction clear out everything beforehand and your dream home will be yours in a hassle-free manner.

So, if you are planning to take a home loan,make sure to consider the above-mentioned tips for easy approval of your loan application.

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