Are you Home Loan savvy? Wait, what?
Buying a house is a one-time investment for most of us, and perhaps the most important one of our lives. Needless to say, a good amount of research is important before your seal the deal. We’ve made a list of some of the important terms you must be familiar with before you take the leap. Here’s what we have:
A sanction letter is a formal document from the bank stating that it has agreed to consider you as one of its customers with regard to a loan. It is important to note that this does not imply that the loan in question will be sanctioned. The actual approval of the loan is subject to verification of all the documents and eligibility.
Equated Monthly Instalments (EMIs)
This is the monthly repayment made to your lender once the loan is fully disbursed. It is a combination of your principal repayment and interest payments. The EMI cannot exceed more that 30% of your monthly income.
The RBI set a ceiling limit on home loans in 2010 which limits the amount of loan one can take against property to 80% of the property value. Popularly known as Down Payment, this is the contribution of the applicant towards the property after the bank pays the more significant amount.
This refers to the release of funds/ loan amount to the borrower by the lender. This is done once all the documents are verified and the down payment has been made.
Most banks charge an administrative fee. This is taken for processing the documents of your Home Loan. On an average, the fee ranges from 0.5% to 2% of the loan amount.
Feel Home Loan savvy, yet? Sure, you do. Might just be a good time to take a look at our Home Loan offers. What say?