Getting your dream home is not at all tough
in today’s scenario. Many banks,
financial institutions, NBFCs and housing finance institutions are willing to
give loan at person doorstep. The person will find his mailbox full of mails
from various financial institutions that provide home loans, at highly
reasonable interest rates along with other benefits attach to it.
The terms and conditions of each bank, NBFCs,
financial institutions and housing finance company differs. Though, the home loan interest rates which are
levied on the loan amount are more or less close to each other. The lenders of
home loan ask for property documents for the security purpose, i.e. in case if
the customer defaults in repaying the amount then the bank will seize his
property. In banking terminology, we called it as collateral security. The
lenders of the home loan scrutinize the property documents, to find the real
value or intrinsic value of the property. After doing thorough study of these
documents, if bank find it fair and right then, they considered the person
property as collateral security.
One can take home loans for various reasons,
for the purchase of land or flat or property, or built up house or for
renovation of existing house, etc. The lenders have fixed various parameters
for granting home loan, which the person, should take care before applying for
the home loan.
The person can fill up the form online or can
physically submit it in the bank. In this form, the person has to fill up his
personal details, such as name, age, contact no, employment details, pan no,
passport no, income details, saving details, details of existing loan (if any).
The lender takes all these information so to make sure that the person has the
repaying ability.
The lenders provide two types of home loan:
fixed rate home loan & floating rate home loan. In fixed rate home loan,
rate of interest does not change with the change in the market like change in
inflation, or in RBI Repo rate or CRR. Whereas, in
floating rate home loan, the interest rates changes with change in following
criteria, i.e. if the inflation rate increases the interest rate also increases
and Vice Versa. The person can also prepay the loan amount without any penalty
in floating interest rate.
One should read the terms and conditions of
the home loan carefully before signing the document and ensure themselves that
the person has understood all the terms, additional charges, interest rates and
EMI amount of the loan.
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