Nowadays it is very common for most of you to avail distinct types of loans for nearly all types of your needs. Most loans are looked upon as a liability. After availing a loan, you as a borrower require cutting down even on your daily expenditure to abide by the recurring EMI (equated monthly instalment). After availing the loan, you require allocating a shoestring budget for buying those necessary products monthly without which you cannot live. A home loan, however, cannot be compared with such loan types as investing in a home is like forming an asset which in most cases, appreciates with time and thus making opting for home loans in Coimbatore, home loan in Dehradun or any other place of your preference is advantageous over the long term. With this in mind, you can simply console yourself. When you opt for a home loan in advance, the beginning or initial pinch of home loan EMI therein would not just be bearable but even will attribute you a sense of mere achievement when you finally avail of a home loan deal.
What are the crucial home loan advantages you must be aware of?
Tax benefit –
There are several tax benefits on home loan repayment both on principal repayment and interest constituent repayment on the home loan.
Value appreciation –
As the name suggests, a home loan allows you to purchase a home, an asset that may generate one of the highest appreciation values. Note that, in this case, you are certainly not purchasing something that falls in value, by the time you leave the showroom.
No tearing of your own pocket –
When you undergo a home loan, there is zero lumpsum amount payable except the down payment amount. Thus, the effect of shelling out a massive sum may be divided over several EMIs over the long term.
Pradhan mantri awas yojana (PMAY) –
The PMAY scheme is just for the first-time home looking to go for a home loan. In case you qualify and once your loan amount is sanctioned, you can avail subsidy on the home loan rate of interest.
Recovery over the long run –
Do not term your EMI on the home loan as an expense. Once you avail your own home, you can rent the same out and repay your EMI with money. Thus, for you, a home loan may be a winning proposition.
Instils a sense of responsibility –
Once your EMI repayment on your home loan starts, you must routinely ensure to keep thorough track of your payment due date, and bank balance and make sure to prioritise them. You thus must ensure to develop a sense of responsibility.
Having your home is a means of meeting your requirements and fulfilling your wishes. However, today, with the rise in the prices of real estate, it has become tough for many to purchase a dream home. Thus, opting for a home loan is most probably one of the easiest means of owning a home.
Opt for a home loan – This is one of the best modes
We indeed are staying in a phase where there are many private and public banks and HFCs (housing finance lending companies) offering various home loan deals, which you must consider. So, while you plan to avail a home loan, you get 2 major options to opt for the loan from HFCs (housing finance companies) and banks. Now, selecting between banks and HFCs for a home loan is based on a few important parameters like processing charges, repayment period, rate of interest, etc.
Here are some important reasons stating why it is better to opt for a home loan from HFCs. Read to understand and get an idea –
Maximum loan repayment period
One of the crucial benefits of a home loan is it has a long loan tenure that you as a borrower can opt for, which can go as high as 20 years. This permits you as a borrower to lower the EMI by extending the loan repayment tenure.
Home loans assist to form a strong credit score
While placing an application for a home loan, the initial thing you must ensure to check is your credit standing i.e., your credit score. The higher your credit score, the better your chances of availing home loan approval.
Select the rate of interest that matches you best
Home loan comes with either a floating rate of interest or a fixed rate of interest. A fixed rate of interest is a specific figure which is fixed as the name suggests when you avail the loan and stay the same throughout the loan repayment period until its completion. A floating rate of interest, on the contrary, tends to fluctuate as per the prevailing market conditions. Thus, based on your requirements, you can select between a floating interest rate home loan and a fixed interest rate home loan.
Save on the down payment amount
A down payment is a crucial aspect to qualify for a home loan. The initial measure towards your goal of availing a home must be to arrange a down payment. In a home loan, you require to personally finance a portion and the remaining gets financed by the home loan lender. So, the more you save, the simpler and easier it is for you to avail a home loan.
Swift loan approval
Your credibility gets computed depending on your age, income, bank statements, nature of work and credit score. The final decision on maximum loan proceeds approval is made by reviewing these parameters too. Note that, higher home loan eligibility often converts into a hassle-free and seamless process.
Home loan processing charge infers the payable fee by you to your lender once your application for a home loan is approved. The processing charges on a home loan differs from one lender to another. All the crucial details linked with a home loan that involves the applicable rate of interest, EMI proceeds, processing charges and others are informed to you in advance, and you can accordingly make up your mind on whether to opt for the loan or choose some other lender.