Buying your own home has always been a huge part of the Indian Dream and it is always a good idea to buy property, either as an investment or as a place to live. But it is also a big investment and more often than not, it is better to purchase it by availing the facility of a home loan. This allows you to avail tax breaks as well as allows you to pay the loan back in different ways based on the terms of the loan while purchasing. Housing loans are mainly of two types, fixed and floating. Fixed loans have a higher down payment but the period of repayment is longer and interest rate are fixed. This usually translates to lower monthly payments and insulation against the possibility that interest rates may rise in the future. Conversely the floating rate may have a lower rate of interest initially but then the interest rates may be revised after some fixed period and then the rates may be revised periodically. Moreover, there are certain charges that banks apply like the prepayment charges, processing fees, pre closure fees and some others, depending on the bank issuing the loan.
Property as an investment has been one of the fastest growing investment opportunities for a number of people looking for a long term investment at a good rate of return. However, as the property rates keep climbing each year, it is getting more and more difficult for regular folk to cough up the entire amount needed to purchase a house upfront. This is where home loans step in and save the day for countless numbers of people who could probably never afford to buy real estate otherwise. In a lot of families it is considered a necessity to have a home soon after you start your career and as such it is not always likely that you can afford to pay up the entire amount needed to purchase it upfront. In such cases, the banks help you by stepping in and paying up to eighty percent of the purchase cost that you need to pay them back with some rate of interest over a suitably long period of time. This serves as a great deal for both the parties involved as the bank earns a decent interest on the amount loaned over a long period of time and you, as the customer gain ownership of your own property that you need to pay for back in small amounts over time, while still getting tax benefits and maybe even a secondary income source if you put it up for rent.
The features of your particular home loan depends on your agreement with the bank. However based on RBI guidelines and the common features across home loans offered by banks, here are a set of common features regarding home loans:
Home Loans are a large investment and require collateral by the bank. Moreover each bank has a different set of requirements as they deem necessary for applicants and as such your experience may vary across banks.
Depending on the bank that you apply to, the list of documents that you are asked to submit may differ. Most banks however, will ask you to at least provide the following documents when you apply for a home loan and so you should keep these handy while applying. Keep any Government issued Identity proof like a passport or a driving license with you. Proof of Residence for your address as filled into the form. Proof of Income like a salary certificate from your employer. Bank statement for the last six months or pass book entries for the same. List of your personal assets and any liabilities you have undertaken. Copy of your income tax returns for the last 2 or 3 years, depending on whether you are a salaried employee or self employed.
We at bankingduniya are committed to helping you find the perfect home loan that suits your requirements best from a wide range of possible options based on various factors like type of interest, different interest rates, type of loan and many more. We try and show you the loans that you may be eligible for and help you to compare and contrast them to find the one that suits you best and once you zero in and decide to apply for one, we will direct you to the concerned bank’s website for application request and further formalities. We provide you with all the details regarding the loan you are considering through on our portal and are committed to keeping the most up to date information on our website, so you don't have to face any unpleasant hidden surprises later. Comparison of different loans and their subsequent terms and conditions is a huge hassle and used to require going through the websites of different banks and reading over pages of terms and conditions to find the best one for you. We try to simplify this process as much as possible by giving you an easy way to compare the options across multiple different providers and letting you find the best one as per your needs.