Housing Loan
A home is a ‘once-in-a-lifetime’ investment for many of us. It is natural that we want to make it as big and better as practically possible. High real estate prices make it difficult for many to buy their dream home but with a home loan it easy by funding up to 90% of the cost of the property. Home loan is a loan that is extended to an individual to buy a house. Buying a home could be one of the biggest achievements of a person’s life. In most cases, it takes an entire lifespan to fulfill the dream of purchasing one’s own home. Selecting the ideal property involves a lot of research and planning. Arranging funds is probably the toughest and the trickiest part of the process.
You could dip into your savings for the entire payment or decide to get a Home Loan at a good interest rate. A decade or so earlier, borrowing from a bank used to be a cumbersome process but today financial institutions have simplified the entire Home Loan application and disbursement process. Before finalizing on a lender, one must understand the intricacies of a Home Loan.
Types of Home Loans
Home Purchase Loan
As evident by the name, this type of home loan can be availed when buying a new home or Flat from the Builder and Resale
Home Renovation Loan
This type of home loan can be availed for the construction of a house. Such a loan is granted only if you already own a
Home Improvement Loan
Home improvement loans are increasingly becoming popular as its interest rates are similar to home loans and other things
Home Extension Loan
With time you might feel the need to add more space to your house for varied reasons, such as a growing family.
To Apply Housing Loan
Plot Plus Construction Loan
A plot plus construction loan is primarily meant for those who want to purchase a plot and build a house on that piece of
What is the Eligibility Criteria for Home Loans?
Home loan eligibility is based on income, age, credit score, property value and location, etc. The table reflects general eligibility criteria at all banks/NBFCs.
| Parameters | Salaried | Self-employed |
|---|---|---|
| Age | Should be between 21-60 years | Must be between 21-65 years |
| Income | Minimum income of ₹1,80,000 p.a | Minimum income of ₹1,80,000 p.a. |
| Current Experience | 2-3 years of current job stability | 720 or above |
| CIBIL Score | 720 or above | 3 years of current business stability |
Fee and Funding
| LOAN AMOUNT | MAXIMUM FUNDING | PROCESSING FEE |
|---|---|---|
| UPTO 30 LAKHS | 90% OF THE PROPERTY COST | 0.50% of loan amount plus GST |
| Rs.30.01 LAKHS – Rs.75 Lakhs | 80% OF THE PROPERTY COST | Upto 0.50% of the loan amount or Max ₹7,500+GST |
| Rs.75.01LAKHS AND ABOVE | 75% OF THE PROPERTY COST | Up to 0.50% of the loan amount or ₹3,000 whichever is higher, plus applicable taxes. |
Loan Process
- Application Form
- Personal Discussion
- Credit, Legal And Valuation Appraisal By Bank
- Loan Sanction Letter
- Signing the loan agreement and disbursement
To view your loan option, you’ll need:
- Full name
- Address information
- Financial Information
- Contact Details
Benefits and Features
Expert legal and technical counseling to help you make the right home buying decision.
To encourage more and more people buy their own house, government of India provides tax deduction on the principal as well as interest paid on home loan. An individual is eligible to claim a deduction of up to Rs.1.5 lakh under Section 80C of Income Tax of India 1971 Act in a financial year. While a deduction of up to Rs.2 lakh is allowed on the interest portion under Section 24B of Income Tax of India Act. The deductions under income tax are only available after the construction of the house is complete. You can’t claim the income tax deductions while the property is under construction. Read: to know more about home loan deductions.
In case of second house, you are eligible to claim deduction for the entire amount of housing loan interest paid under Section 24B of Income Tax Act.
Unlike other loans where lenders charge prepayment penalties on payment made towards home loan, there are no prepayment penalties on floating rate home loans. So, whenever you have surplus money, you can utilize it for making part payment towards your home loan and lower your burden. However, there will be prepayment charges in case of floating rate home loan.
For many people buying house with own money is not possible, home loan as it can be repaid in easy monthly installments makes it easier to buy a house.
Among all types of loan, home loan has the longest repayment tenure which goes up to 30 years, so one can reduce the burden of equated monthly installments by extending the tenure. Use our home loan EMI calculator to know how EMI change as you change your home loan tenure.
You will also benefit from the rise in prices of the property over time.
As rent in metro cities is quite high they put strain on your monthly budget. It is better to pay the EMIs and own a house.
Plot Plus Construction Loan
A plot plus construction loan is primarily meant for those who want to purchase a plot and build a house on that piece of