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Home Loan

Buying a home may seem complicated; however, if you process it systematically, you may soon be holding the keys to your new home!!! The first step towards your loan is choosing the best housing finance company that can guide you through the entire procedure.

Given below are tips to choose the best home loan lender:

1) Always Choose the Lender After Finalizing the Property:

Shopping for the home loan comes after identifying the property. Some banks offer finance for ready to move in properties, whilst others may lend for a property that is being self constructed or a property under construction. Therefore, finalize your property first and shortlist the financing options thereafter.

2) Ascertain your loan eligibility

Banks follow different criteria to calculate loan eligibility. In case loan eligibility based on your income is an issue, you should talk to different banks to find out which bank can provide you with the maximum amount. There is also an option of clubbing your own and your spouse’s income to increase your loan eligibility.

3) Be Ready to Loose Your Processing Fee:

Banks charge a processing fee to get any loan application on roll. The fee is generally around 0.50% to 1.00% of the total loan amount. Paying the processing fee does not ensure the clearance of the application but it ensures that your application will be seen. Moreover, the processing fee is non refundable. Whether your loan is sanctioned for a higher or lower rate, you will not get the processing fee back. Never trust the verbal promises made by any bank representative. Get everything in writing.

4) Fixed or Floating Rate of Interest:

In the case of a fixed home loan rate, the rate of interest does not remain fixed for the entire tenure but for a specific period of time. The lender has a right to arbitrarily change the rate further. On the other hand, if you are opting for a floating rate loan, be sure to check whether the rates of your chosen lender had floated down over the last couple of years.

5) A Stitch In Time Saves Nine:

Never hasten the shopping process. The cost of your loan largely depends on how you negotiate. Home loan lenders primarily take your income and personal profile into consideration. Apart from the rate of interest, the points you should take into account while choosing the best financer are the processing fee, legal charges, pre-payment charges, valuation fees, and other hidden costs.

Categories: Home Loans