Buying a home is a big decision. A majority of us depend on financial assistance for it. Opting for a housing loan is indeed a smart way to fulfil your dream of owning a home, without straining your finances.
It is also a great option when you do not want to liquidate your savings or fall short of funds. However, things are not that simple as they might seem at this stage. There are certain factors and aspects that every applicant should be aware of, before signing the home loan papers of residential apartments.
- Home Loan Tenure – Every person who desires to get a home loan should decide its repayment tenure before anything else. The golden rule says, shorter the tenure, the lesser would be your total home loan cost and vice versa. However, shorter tenure will also come with higher monthly instalments.
- Interest Rate – Every home loan applicant should check and compare the home loan interest rates offered by different financial institutions. There are primarily two types of interest rates – fixed and floating. If you go for a fixed interest rate, your EMI won’t vary throughout your home loan tenure. But if you go for a floating interest rate, it is subject to fluctuations over time.
- Understand Foreclosure Norms – You should know the home loan foreclosure norms released by RBI from time to time. Foreclosing the loan in less than the stipulated tenure spares you from paying added expenses. That’s not all, foreclosures also have an excellent impact on your CIBIL score.
- Read the Documents Carefully – Every home loan applicant should read all the documents carefully before signing. Moreover, any confusion regarding down payment, additional charges, and penalties should be discussed in advance.
- Credit Score – Are you planning to buy a 3bhk luxury apartment in Jaipur? If yes, you should have a minimum CIBIL score of 750. Credit score plays a vital role in determining the viability of a person and his loan repayment capacity. Making timely payments of your credit card bills and current loans will help you in maintaining a good CIBIL score.
These are the top 5 factors that you should know well before going ahead with a home loan application. You can also connect with a market expert to know more details about home loans. Whichever financial institution you choose, just ensure you take enough time to understand the terms and conditions of a home loan before signing the papers. Good Luck.
