Do read the fine print in your loan documents!

By BankBazaar | March 29, 2011

If you want to avoid nasty and scary surprises in future, causing you to pay much more than what you had anticipated, read the fine prints of your housing loan or any loan documents. Most borrowers put their property choice under strict radar, keeping in mind what your like and dislikes, but rarely do they show this sort of enthusiasm in reading the fine print of their loan agreement. We all are just in hurry to sign on those sheets of legal documents and get over with the paperwork.

But here are a list of Do’s that you need to ensure to carry on :

Study the sanction letter :

It is not advised to rely completely on your lender’s explanation of what your loan’s T&C is all about. It is very important for you, as a prudent borrower, to read the sanction letter carefully. For example a borrower due to lack of time, signed on home loan agreement assuming that it would be provided at fixed rate of interest but little did he know that the bank could revoke the rates and alter them during the course of the loan, which they eventually did. On learning this, obviously, the borrower was in a shock as the little change in the interest rates could alter his financial repayment structure completely.

So do make it a point to read the sanction letter if not the T&C of the loan agreement, if there is a paucity of time.

Look out for the hidden charges :

Now, most banks charge, processing fees, inspection fees etc. If you have not read your T&C’s then you will not be in a position to know why you EMIs are carrying a little higher amount than expected. Although it is rightfull on the banks behalf to charge such fees, however you get into negotiations with your bank in order to reduce the amount on such charges.

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