You have decided you want to purchase the home of your dreams and have zeroed in on a particular house. The ideal next step in this process would be to apply for a home loan. Since this is an extremely important step, you need to ensure that you find the right home loan provider that best fits your needs and objectives. Moreover, this process can sometimes be extremely stressful due to the availability of so many financial institutions and banks providing amazing deals and offers.
So how do you decide which home loan lender is the right one for you? Below are some of the factors, which can help you take an appropriate decision.
Loan Eligibility and Loan Amount
There is absolutely no doubt that home loans come with a variety of benefits. Today, you have the option to customize your home loan according to your needs and requirements. The loan amount you would be eligible for would depend on your monthly income and the value of the home you are purchasing. So typically, you can get a loan for about 80-85% of the cost price of the house you buy. In some cases, this can be more as well.
When going in for a loan, you should keep in mind your financial situation, responsibilities, assets, liabilities, and debts. Plan your expenditures well and set aside the money needed for the repayment of your loan, every month. Also, take into consideration future expenses like wedding, planning for a baby, etcetera. You could use a Finserv MARKETS home loan EMI calculator to calculate your EMI. Apply for a loan only when you have gained a good understanding of the loan you are going in for.
Your home loan interest rate will decide the EMI that you will pay every month. Hence, search for the best rate of interest available in the market from a host of different financial institutions. You could either choose a floating interest rate or a fixed interest rate, depending on what fits your requirements. Ideally, a floating rate of interest would work better if you are going in for a long term loan. This is because a floating interest rate is dependent on market volatility. In simpler terms, your rate of interest will sometimes be lower or higher than the fixed rate of interest which, eventually will be beneficial to you over the long run by virtue of cost averaging. If you are eligible for Pradhan Mantri Awas Yojana scheme, you can enjoy additional benefits of reduced EMI and a lower interest rate of 6.93%.
Processing Fees and Other Charges
Most lenders would charge processing fees for your home loan or home loan balance transfer. At Finserv MARKETS, we charge minimal processing fees and also have certain terms for prepayment as well. So, before you finalize on a loan provider, make sure you understand all the clauses mentioned in the terms and conditions document and negotiate on the final price if you can.
How Responsive the Lender is to Change in Interest Rate?
Always check if the home loan provider is offering a switch policy in order to get a lower rate of interest benefit. If you find a loan provider who can reduce the rates and at the same time follow the regulations of RBI, then you should definitely consider taking a loan from them. Chances are that this provider will give you a fair deal now as well as in the future.
You should also consider other factors like documentation requirements, hidden charge (if any) and speedy process. Usually, most lenders would require the same type of documents, but it’s important you find out about the same beforehand.
Once you have done all the necessary checks, choose a loan provider who fits your criteria. Bajaj Finserv Home Loans at Finserv MARKETS comes with a number of benefits, but choosing the right home loan provider would require a little time and effort but, in the long run, it eventually pays off.
“Finserv MARKETS, a subsidiary of Bajaj Finserv, is a one-stop digital marketplace that has been created for consumers on the go. It offers 500+ financial and lifestyle products, all at one place. At Finserv MARKETS, we understand that every individual is different. And that’s why we have invested in creating a proposition – Offers You Value. A value proposition that ensures you get offers which are tailor made for you. We also offer an amazing product range and unique set of online offers across Loans, Insurance, Investment, Payments and an exclusive EMI store. Be it in helping you achieve your financial life goals or offering you the latest gadgets, we strive to offer what you are looking for. From simple and fast loan application processes to seamless and hassle-free claim-settlements, from no cost EMIs to 4 hours product delivery, we works towards fulfilling all your personal and financial needs. What’s more! Now enjoy the same benefits in just one click with our Finserv MARKETS App.”