Home loan is a short to medium term unsecured loan granted to an individual. It is commonly used to meet such financial needs as debt consolidation, wedding expenses, unexpected medical costs, home renovation and others. Flexibility of usage, minimal documentation and quick processing make personal loan a preferred financing option. Unlike other loans, it usually has a shorter repayment tenure ranging from 1-5 years. Depending upon the individual applicant's profile and lender, the APR (Annual Percentage Rate) of a home loan may vary from 11.29% to 35%.
For example, if you take a loan of Rs. 4.5 lakhs at the rate of 15.5% with repayment tenure of 3 years, your EMI will be Rs. 15,710. The total payable amount at the end of 3 years would be Rs. 5,65,553. Therefore, you are paying total interest amount to the tune of Rs 115,553. This, however, excludes other applicable charges which can be quantified as under:
Loan Processing Charge@2% = Rs.9000
Documentation charges = Rs. 500
Amortization Schedule charges = Rs. 200
In case of change of payment mode or swapping your Post Dated Cheques, additional charges are applicable. Also, depending upon the lender bank, prepayment options may or may not be available and the applicable charges may vary accordingly.
Everyone has a dream of owning their own house. However, not everyone has the necessary monetary support to purchase one. If you want to own a house for residential purpose, then you can opt for home loan at finkosh.com. Home loans are secured loans. The financial institute will retain the property documents as collateral. You can simply compare top banks and NBFCs (non-banking financial companies) offers on housing loan and apply for the loan.
It takes less than 2 minutes to complete the application. Loan amount available is up to Rs. 1 crore or less with interest rate starting at 8.35%. The loan can be applied by salaried, professionals, self-employed, and businesspersons. The tenure can extend till 20 years to 30 years. The repayment options are flexible and suited to fit your repayment capacity.
You can take home loan for purchase of old or new property of residential purpose. It can be a flat, a piece of land, or any residential property. Agricultural, industrial, and commercial properties are excluded from the scheme. The housing loan can be used for home extension, construction, repair, and renovation as well. Sometimes, you want additional loan on existing loan, and opt for a top up home loan.
There are no unsecured home loans as in the bank or NBFC will keep the property documents as collateral. However, you can stay in the house and use it for residential purpose even while the repayment tenure is ongoing.
The Home loan interest rates bases on marginal cost of lending rate (MCLR) plus a spread on the MCLR that depends on lender’s risk perception about the borrower. At loanbaba.com, you can get loans online for purchasing residential property starting at 8.35%. Almost every financial institute offers competitive interest rates to attract customers. You can compare home loans interest rate at loanbaba.com to get the lowest rates possible.
Finkosh.com provides you free-of-cost home loan EMI calculator so that you can take an informed decision and choose the right loan option at affordable rate. Additionally, you learn to manage your finance by knowing the monthly cash-outflow towards the loan repayment. You can check EMI for housing loan within seconds with this financial tool. The EMI calculator considers the loan amount, interest rate and tenure to show the exact equated monthly instalment you have to pay.
You will also receive a complete amortization sheet to understand the EMI payment schedule through the loan tenure for every year. The instant results from using this tool helps in saving time taken to calculate manually using the formula: EMI = [P x R (1+R) N]/ [(1+R) N-1], where E is the EMI, R is the rate of interest estimate on monthly basis, P is the principal loan amount.
Q. Can I get a home loan for the entire property value?
Ans - No. Banks usually keep a 20% margin when providing individuals with a home loan. This means that the lender may agree to provide you with 80% of the property value as a home loan, while you will have to shell out the rest 20% by yourself. In some cases, the lender can agree to provide you with up to 90% of the property value as a home loan.
Q. Are there any tax benefits of a home loan?
Ans - Yes. Both the loan principal amount and the interest paid towards loan repayments provide tax benefits under Section 80C and Section 24 of the IT Act respectively.
Q. Who can co-sign a home loan with me? Can my friend co-sign a home loan for a flat?
Ans - Your family members like father, mother, siblings, etc. can co-sign a home loan with you. Other than that your spouse or adult children can also be co-signatories in case you are applying for a home loan. In India, as per existing rules, your friend cannot co-sign a loan as he/she is not a blood relative or otherwise related to you.
Q. How many people can co-sign a home loan with me?
Ans - At present, up to 7 people can co-sign a home with the primary applicant. However, all of them need to be blood- relatives of the family member.
Q. Are there any prepayment charges in case of a home loan?
Ans - In case of a floating rate home loan, lenders don't charge a pre-payment penalty as per RBI directives however a penalty may be applied in case of prepayment of a fixed-rate home loan. You can visit the Home Loan FAQs page for additional details on home loans.
Q. How home loan EMI is calculated?
Ans - Equated Monthly Instalment (EMI) is the amount that you repay each month against your home loan principal amount and its interest amount. So, while calculating the home loan EMI, both the principal amount and the accrued interest on the loan is taken into consideration.
Q. How to use Home Loan EMI calculator?
Ans - Home loan EMI calculator is an effective tool for comparing different loan options which are available to you from different banks and financial institutions. You can use the home loan EMI calculator on Paisabazaar to calculate the EMI which you will have to pay for your home loan. Paisabazaar's home loan EMI calculator will provide you instant results to help you take an informed decision. You only need to provide few details like loan amount, interest rate and tenure of the home loan. You can check your EMI by following the below-mentioned steps:
Q. What are the important points to remember while choosing a home loan?
Ans - Home loan is a long term obligation to fulfil. One should always stay aware and keep in mind the following points while choosing a home loan in India online:
Q. What are the reasons for home loan rejection?
Ans - Factors that can play a crucial role in home loan rejection are mentioned below:
|Ensure that you have researched on the loan you want to apply for||Do not blindly sign the documents before you read every term and condition on it|
|Read the fine print before taking the loan||Do not forget to compare interest rates offered by different loan providers|
|Look out for any charges applicable on prepayments and foreclosure||Do not default on your monthly payments|
|Make sure you pay the equated monthly instalments (EMIs) on time||Do not apply for a loan just for the sake of it|
|Ensure that you have a good credit score before you apply||Do not sign the home loan agreement before reading the clauses|
|Apply for a loan amount you are eligible for||Do not request for a change in tenure unless you have considered all the aspects|
|Submit all the necessary documents||Do not submit an incomplete or mismatched loan application|
|Ensure that you have stable employment||Do not have too many ongoing loans|