You want to purchase a home. You have checked with a lender, and you are eligible for a home loan. But, the problem is that the lender expects you to make a down payment and you do not have the money for the down payment. There is a solution - you can take a personal loan to help yourself. But, If you are planning to take one, there are there are few things you need to consider.
1. You will have to pay two EMIs – Use the EMI calculator to judge your repayment capacity for both the loans. If you miss an EMI,
- You will have to pay interest on the missed EMI
- Your credit score will be negatively affected
2. There is a difference between the two loans – There are major differences between home and personal loans. Personal loans are for a shorter tenor with a higher rate compared to home loans.
3. You need a high credit score – Since you are planning on taking two loans, it goes without saying, your lender will require a high credit score. 750+ is considered good, but several reputed NBFCs give personal loans to applicants even with a score of 700. Thus, you may want to improve your credit score before applying for either of the two loans.
4. You have to submit documents – It does not matter if you are applying for a small amount or a larger amount, you have to furnish your KYC documents. Additionally, you also have to fill in the application form correctly for your loan to get approved.
Click here to know about the other things you need to take care of when taking an unsecured loan to make a home down payment.