Home loans have become popular as many think it is the only way in which one can own a home without straining their finances. Many Indians today are of the opinion that settling down and owning a home are practically synonymous. To satisfy this increasing demand for home loans, there are several types of home loans one can choose from today.
Banks and housing finance companies (HFCs) now offer various home loans and schemes for women, farmers, CA, doctors etc., to cater their specific needs by providing various different types of housing loans in India. Let us read in detail which one is beneficial for you to avail.
Several lenders offer home loans for buying as well as for a variety of other purposes. Below mentioned are some of the popular types of home loans available in the financial market:
Loan for Home Purchase
House Construction Loan
Home Improvement Loan
Home Loan Balance Transfer
House Expansion or Extension Loan
Home Conversion Loan
NRI Home Loan
Stamp Duty Loan
Loan for Home Purchase: As the name suggests, such loans are used for buying a brand new or a pre-owned house. Your interest rate will be either fixed or floating. Typically, the interest will be between 6.99% and 12.00% if you pick up a home loan from a Bajaj MARKETS lending partner. But, the final interest rate applicable to you will depend on your personal eligibility.
Plot Loan: Several institutions provide loans for the purchase of a plot of land. Owning a plot provides a lot of flexibility to owners, who can then construct a house at their discretion. You can also purchase the land simply for the purpose of an investment. One can now avail a plot loan of up to ₹3 Crores as a salaried or self-employed individual from the likes of an ICICI Bank.
Property Loan: Plot loans are also known as property loan, which is Loan Against Property (LAP). In the case of a property loan, the first instalment of the loan amount is disbursed to the borrower when the relevant documents concerning the purchase are furnished. The subsequent disbursals depend on the construction status of the house.
Home Construction Loan: If you own a piece of land and would like to build the home of your dreams on it, you can always go for a home construction loan. This particular kind of home loan is different from your standard home loan as the home construction loan amount is disbursed in several phases depending on the status of the construction project. It must be noted that the approved amount will depend on the approximate construction cost. Now, you can easily avail home construction loan schemes from Bajaj MARKETS’ partner ICICI Bank.
Home Renovation Loan: Renovation and/or repair work associated with a home such as the likes of internal/external repair, construction of overhead water tanks, and/or electrical renovation certainly will make your home look better. However, it certainly comes at a cost. To cover the same, you can always pick up a Home Improvement Loan and then repay the same over the course of several years. Avail home improvement loans from specialised banks like PNB Housing.
Home Loan Balance Transfer: This specific option can be availed if you want to transfer your home loan from your current bank/NBFC to another lender. You may choose to do so if the other bank is offering you a lower rate of interest or a better range of services or both. Avail home loan balance transfer from specialised banks like Bajaj Housing Finance and Union Bank of India.
House Expansion or Extension Loans: Many would like to add extra rooms or a balcony to their house and this loan is perfect for such clients. It’s a type of financial assistance for altering the structure of your house or for home extensions.
Home Conversion Loans: This loan can be used by those individuals who are currently paying off a housing loan but would like to move into a new house. With the home conversion option, one can transfer their existing loan to the new home.
Home Loan for NRIs: Home Loans for Non-Resident Indians (NRIs) function just like standard home loans, except these require the applicants to ensure a different set of formalities. Typically, a majority of private and public sector banks offer NRI loans as a part of their housing loan portfolio.
Bridge Loan: Bridge Loans are essentially short-term loans which have been designed for existing homeowners that plan on purchasing a new property. It aids borrowers in funding the purchase of their new house until a buyer for the existing property is identified. Such types of loans typically require the mortgage of the new home and are extended for less than 24 months.
Stamp Duty Loans: As the name itself suggests, stamp duty loans are sanctioned for the purpose of covering stamp duty charges, which must be paid at the time of buying a property. Such loans rarely witness applicants, but do exist for those in need of funding to cover stamp duty charges through a loan.
Disclaimer: One must make note of the fact that the aforementioned interest rate figures are always subject to constant change. Hence, we would highly recommend that you check with the bank before initiating the home loan application process.
Now that you have learned about the kind of home loans that exist in the market, you should be able to choose the right one for yourself. To apply for any of the above-mentioned home loan options, you can always take a look at the house loan offers from the lending partners of Bajaj MARKETS. Through Bajaj MARKETS, you also get access to benefits such as pre-approved loan offers, balance transfer facility, flexible repayment tenure, and a credit health check report, among many others.