All set to take the property plunge? You’d better jump in right now. Market conditions are now ideal to make that investment decision you’ve been holding off all this while.
The credit goes to inflation. Inflation is the rate at which the price of goods and services rise. The lower inflation is, the cheaper Home Loans get!
Also, a recent report showed that the supply of affordable housing went up 95% on a year-over-year basis. Strike when the iron’s hot, what say?
Why Get a Home Loan?
So, interest rates are coming down but you still aren’t quite convinced that a Home Loan is for you. You think it makes more sense to use up all your savings to buy your house. Well, we suggest getting a Home Loan instead. While a lot of us shy away from the “burden” of a Home Loan, it offers more advantages than one can imagine.
- Credit History
Getting a Home Loan can give your Credit Score a great boost. If it is your first ever loan, you could start off building a great credit history. Home Loans rank high on CIBIL score ratings because they are long-term loans. The better your CIBIL score, the better your chances will be with getting other loans and availing of cheaper interest rates.
Do you have the perfect CIBIL score to get a Home Loan?
- Makes Selling Easy
When you take a Home Loan, your house is backed by the bank, which is a pretty big deal when it comes to property appreciation and sale. Selling your house becomes easy when your papers are all intact and have the stamp of a reputed financial institution.
- Save Big on Taxes
A Home Loan ensures you big savings on taxes. You could claim an annual tax benefit of up to Rs. 2,00,000 on the interest paid on your EMI under Section 24 of the IT Act. You can also claim an annual benefit of up to Rs. 1,50,000 on the principal amount, which comes under Section 80C of the IT Act. Also, if you have a partner holding the loan with you, your partner can avail of tax benefits separately on the loan.
There are different kinds of loans for different purposes. These include top-up loans, mortgage loans, second Home Loans, and more.
Things to Keep in Mind While Opting for a Home Loan
If this is your first Home Loan, here are a few things you should keep in mind:
- Take a loan for a property that you can afford. Calculate your EMI carefully and negotiate for a lower interest rate.
- Find out what type of loan you are comfortable with – fixed or floating. The floating interest rate fluctuates according to market conditions. A fixed rate, although about 1% or 2% higher than floating rate, does not change with market conditions.
- Read the documents of the Home Loan carefully. Some banks may have security clauses, penalties, and other add-on charges. Make sure you know your papers in and out.
Nothing But The Best
All that might sound slightly daunting but worry not! We have cherry-picked some Home Loans that you could consider getting if you are planning on buying your first house. These loans offer great interest rates, provide good customer service and have a speedy approval process.
State Bank, one of the most popular banks in India, offers a floating rate of 9.35 percent. They charge a minimum processing fee of 0.35 percent and you could get a loan amount of up to Rs. 10 Crore for a 30-year tenure. This is an especially good loan for the ladies because women can avail of a lower rate. Get this loan approved within 5 days at over 13,000 branches across the country.
The IndiaBulls Home Loan is a fast moving Home Loan product. Floating interest rates range from 9.45 percent to 10.5 percent. You could borrow up to Rs. 3 crore with a maximum tenure of 30 years. You could get the loan approved in about 8 days without the hassle of too much paperwork as loans are approved online.
This Home Loan has a floating rate of 9.55 percent to 9.80 percent. There is a one-time processing fee of just 0.50 percent (max) and the minimum amount you could borrow is Rs. 5,00,000 for a maximum tenure of 30 years. This loan is known for its door-step service. You undertake all the paperwork in the comfort of your home. The best part? If you qualify, you could get the loan approved in just 3 days.
Getting a Home Loan from ICICI bank assures you a stress-free experience. They offer attractive floating interest rates starting from 9.45 percent and have no pre-closure fee. They also have a door-step facility and part-payment option. There are no part-payment fees and the loan process is pretty speedy. In fact, your loans get approved on the same day as your application.
Want to save big on EMIs? You should definitely consider the Axis Bank Super Saver Home Loan. They offer a 9.75 percent floating interest rate. You can leverage any surplus amount from your matured investments with Axis Bank to pay off the interest on your Home Loan. You can avail of a loan tenure of up to 20 years and borrow up to Rs. 5 crore.
Since most of these banks offer a floating interest rate, you should make use of the low rates now. Rates could go further down depending on inflation as the RBI is expected to reduce interest rates to induce growth.
Already have a Home Loan? How about getting Home Loan Insurance?