When it comes to life goals such as owning a home, it is a major step and brings in a huge sense of accomplishment. However, with the rising real estate, prices it becomes difficult to buy a home through your savings entirely. To fill this gap applying for a housing loan is an ideal way to finance your home purchase. However, lack of funds is not the sole reason why people take a loan to purchase a home. A home loan is one of the cheapest financing facilities which comes with a low rate of interest and offers advantages, for example, it can help you save tax or provide tax benefits, guaranteeing enough liquidity and allowing your funds to grow. Also, financial institutions offer tailored deals and concessions on home loan to support their home buying needs of individuals. Let’s have a look at the government employees home loan benefits and the policy reforms you are entitled to as a government employee to make use of them and become a homeowner.
The lending institution offers special home financing programs for government employees. As per the new home loan policy, you can make loan repayments until the age of 75 via EMIs (Equated Monthly Installments) that can be capped at 50% of your net monthly income. Such privileges can be availed by government employees on immediate payroll as well as retired government employees on pension.
If you're eligible for a housing loan you can avail a loan at a lower home loan rate of interest. However, if you are a government employee you can get a loan at even lower rates, especially female government employees who get up to 0.05% lower interest rate on housing loans. Such benefits make it even more favourable for government employees to apply for a home loan.
To qualify for a housing loan, the government employee has to fit in the basic home loan eligibility criteria. Eligible loan applicants will get the loan sanctioned faster, without waiting for days for approval. Along with instant loan approvals, some lenders also eliminate the processing fee on the home loan amount. You can avail a loan on nominal rates and convenient loan terms without spending a large part of your savings.
The House Building Advance (HBA) scheme offers home loan for central government employees and state government employees for construction of a new home. Previously, government employees were allowed to take an Rs. 7.5 Lakhs of HBA. However, as per the recent changes in the policy, you can now avail a loan of up to Rs. 25 Lakhs. The previous limit for HBA of Rs. 1.8 Lakhs offered for home expansion projects has been increased at least 5 folds to be capped at Rs. 10 Lakhs.
The government altered the existing norms for home loans and at present married couples that work for the central government are eligible for the scheme. The couple can avail a loan with the House Building Advance (HBA) scheme without any issues.
For a smooth application process, you fit the basic housing loan eligibility criteria. The criteria are as follows:
To be eligible, you must be an Indian citizen.
Work experience of at least 3 years is required to be eligible.
Individuals between the age of 23 and 70 are eligible for a housing loan.
The applicant must have a CIBIL Score of over and above 650.
Mentioned below are the documents required to apply for a housing loan
Aadhaar Card/Passport/Driving License
Form 16 or your latest salary slip
3 months bank account statement
When you apply for a housing loan ensure you use a home loan EMI calculator to make an informed decision in managing your finances. The EMI calculator is easily accessible and available online; you can also find it on the website of the bank. With a home loan EMI calculator, you can get the estimated amount that needs to be paid towards your loan till the end of your loan tenure. This way, you will be able to understand whether you can afford the monthly repayments and make your financial decisions accordingly. To be able to use the EMI calculator, you just need to fill in the following details and get your results:
Loan Amount: The desired loan amount that you wish to avail with the housing loan
Loan Tenure (In Years): The desired loan tenure to avail the housing loan.
Interest Rate (% P.A.): The rate of interest applicable to the housing loan
Purchasing a home is one of the major financial investments you may make in your lifetime. Hence, it is advisable to understand all aspects of a home loan before you apply for it. There are numerous financial lending institutions in the financial market that offer housing loan at discounted rates especially for government employees. If you are a government employee you can avail the scheme and use the funds to purchase your dream home. To get an attractive interest rate on loan you can apply for a Bajaj Housing Finance home loan at Finserv MARKETS, and avail credit of up to Rs. 3.5 crore with flexible tenure of as long as 360 months. With the Finserv MARKETS app, you can avail a home loan for a wide range of monetary necessities, negotiate interest or the tenure of the loan and get customized pre-approved offers and instant approvals on loans.
As per RBI guidelines, no lender is permitted to offer 100% home financing. You need to make a down payment amounting to 10-20% of the property’s purchase price. Typically, you can obtain up to 80% housing loan financing for your property.
When you apply for a home loan, there are some rules and regulations that should be followed to make the process of borrowing a little easier. These are:
Larger the down payment, the better for you.
Home loans are long term borrowing instruments with repayment tenure of up to 30 years, generally. The tenure offered to you for your loan depends on the loan amount that is sanctioned to you by the lender along with other factors.
Salaried government employees with work experience of 3 years can typically get a home loan of up to Rs. 3.5 crore and self-employed individuals having a business continuity of 5 years can avail funding usually up to Rs.5 crore. Use the Housing Loan Eligibility Calculator to know the maximum loan amount based upon your income, tenor, and current obligations.