Whether investing in ones first home or purchasing a second residential property for rental income- availing a Home Loan is the most practical finance solution. When a loan seeker is considering options, he/she should bear in mind the Home Loan interest rates charged by different banks and Non-Banking Financial Companies (NBFCs). This cost of borrowing determines how easy or difficult the repayment of the availed debt will turn out to be after disbursal.
There are a host of factors based on which banks and NBFCs decide the eligibility and approval for a Home Loan application. These factors include the applicant’s age, cumulative monthly income, existing loans and liabilities, employment type, credit or CIBIL score and past repayment history. Lending institutions have a scale within the limits of which they grant Home Loans to applicants based on their credit and personal profiles.
Listed below are a few factors that will help an applicant avail a Home Loan with the most practical interest rate:
Start Budgeting and Preparing for the Loan Early
Since Home Loans require long term financial commitment, an applicant should make sure that his/her finances are aligned to accommodate the same along with the existing loans (if any), credit card dues and monthly expenses.
Compare Available Offers
An important part of finding the right Home Loan scheme is comparing available options from different banks and NBFCs. So, an applicant should not finalise things with the first loan offer they encounter, but instead, they should look around for more feasible options and zero in on the best option available.
Applicants should also consider the tenure of repayment which affects the interest rates and the EMI to be paid. They can benefit from the lowered rates of interest and a favourable real estate market as well.