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About Home Loan

With a home loan, you can avail of a substantial amount of money to purchase a new home or renovate an existing one. Depending on your eligibility and credit score, you can borrow up to 80% of the property value. Home loans come with flexible repayment options ranging from 10 to 30 years, making it easier for you to pay back the loan in easy monthly instalments.

If you are planning to buy your dream home , a home loan is an ideal financial solution for you. Home loans are a type of secured loan offered by banks and financial institutions that allow individuals to buy a home without having to pay the full purchase price upfront.

Before applying for a home loan, it is important to assess your financial situation and choose a lender that offers the best interest rate and repayment options. You should also read the terms and conditions of the loan carefully and understand the fees and charges associated with it.

Owning a home is always special, We at LoanBaazar.com are here to  make your dreams come true. 

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New Home

New Home Loan at basic interest rates. You can apply online and check your eligibility and easy EMI. Fast Approval for your new home loan.

Home Conversion

A home conversion loan is a scheme for those who have already taken a housing loan. This loan follow some rules and regulations.It is a part of loan.

Land Purchase

LoanBaazar.com also offers home loan for land purchase to make your dream home. You can compare home loan rates with our compare loan table. Apply online for Home Loan.

Home Renovation

Get instant approval for renovation your home. LoanBaazar.com introduce home improvement loan. It is with basic rate and flexible EMI repayment.For more detail you can check our loan products.

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Features of Home Loan

Home loans are readily available in India, and the process of applying for a loan is straightforward. Most banks and financial institutions have a simple application process, and the loan approval and disbursal can be done within a few days.

Loan Amount

Home loans are typically available for a wide range of amounts. The loan amount depends on various factors such as the borrower’s income, credit score, and the value of the property. Home loans usually cover up to 80% of the property value.

Interest Rates:

Home loans come with two types of interest rates: fixed and floating. Fixed interest rates remain constant throughout the loan tenure, while floating interest rates fluctuate based on market conditions. The interest rate can vary depending on the lender, loan amount, and borrower’s credit score.

Loan Tenure

Home loans come with flexible repayment options that range from 10 to 30 years. The tenure can be chosen based on the borrower’s financial situation and repayment capacity. Longer tenures mean smaller EMIs but higher interest payouts, while shorter tenures mean larger EMIs but lower interest payouts.

Tax Benefits

Home loans offer several tax benefits to borrowers. Borrowers can claim a deduction of up to Rs. 1.5 lakh on the principal amount and up to Rs. 2 lakh on the interest paid on the home loan under Section 80C and Section 24 respectively of the Income Tax Act.

Home Loan - Eligibility

Any salaried, self-employed or professional Public and Privat companies, Government sector employees including Public Sector is eligible for a personal loan.

Age

You should be at least 21 years of age at the time of applying for a home loan. The maximum age limit can vary from lender to lender but is usually 60-65 years.

Income

You should have a stable source of income to be eligible for a home loan. The minimum income requirement can vary from lender to lender but is usually around Rs. 25,000-30,000 per month.

Credit Rating

Your credit score plays a crucial role in determining your home loan eligibility. A credit score of 750 or above is usually considered good, and lenders prefer borrowers with a good credit score

Frequently Ask Questions

If you have a question that deals with clients, customers or the public in general, there is bound to be a need for the FAQ page.

Your bank will assess your repayment capacity while deciding the home loan eligibility. Repayment capacity is based on your monthly disposable / surplus income, (which in turn is based on factors such as total monthly income / surplus less monthly expenses) and other factors like spouse’s income, assets, liabilities, stability of income etc. The main concern of the bank is to make sure that you comfortably repay the loan on time and ensure end use. The higher the monthly disposable income, higher will be the amount you will be eligible for loan. Typically a bank assumes that about 55-60 % of your monthly disposable / surplus income is available for repayment of loan. However, some banks calculate the income available for EMI payments based on an individual’s gross income and not on his disposable income.

In addition to all legal documents relating to the house being bought,  banks will also ask you to submit Identity and Residence Proof, latest salary slip ( authenticated by the employer and self attested for employees ) and Form 16 ( for business persons/ self-employed ) and last 6 months bank statements / Balance Sheet, as applicable . You also need to submit the completed application form along with your photograph. Loan applications form would give a checklist of documents to be attached with the application.

Do not be in a hurry to seal the deal quickly.

Please do discuss and seek more information on any waivers in terms and conditions provided by the commercial bank in this regard. For example some banks insist on submission of Life Insurance Policies of the borrower / guarantor equal to the loan amount assigned in favour of the commercial bank. There are usually amount ceilings for this condition which can also be waived by appropriate authority. Please read the fine print of the bank’s scheme carefully and seek clarifications.

Banks generally offer either of the following loan options:

Floating Rate Home Loans and Fixed Rate Home Loans.

For a Fixed Rate Loan, the rate of interest is fixed either for the entire tenure of the loan or a certain part of the tenure of the loan. In case of a pure fixed loan, the EMI due to the bank remains constant. If a bank offers a Loan which is fixed only for a certain period of the tenure of the loan, please try to elicit information from the bank whether the rates may be raised after the period (reset clause). You may try to negotiate a lock-in that should include the rate that you have agreed upon initially and the period the lock-in lasts.

Hence, the EMI of a fixed rate loan is known in advance. This is the cash outflow that can be planned for at the outset of the loan. If the inflation and the interest rate in the economy move up over the years, a fixed EMI is attractively stagnant and is easier to plan for. However, if you have fixed EMI, any reduction in interest rates in the market, will not benefit you.

Determinants of floating rate:

The EMI of a floating rate loan changes with changes in market interest rates. If market rates increase, your repayment increases. When rates fall, your dues also fall. The floating interest rate is made up of two parts: the index and the spread. The index is a measure of interest rates generally (based on say, government securities prices), and the spread is an extra amount that the banker adds to cover credit risk, profit mark-up etc. The amount of the spread may differ from one lender to another, but it is usually constant over the life of the loan. If the index rate moves up, so does your interest rate in most circumstances and you will have to pay a higher EMI. Conversely, if the interest rate moves down, your EMI amount should be lower.

Also, sometimes banks make some adjustments so that your EMI remains constant. In such cases, when a lender increases the floating interest rate, the tenure of the loan is increased (and EMI kept constant).

Some lenders also base their floating rates on their Benchmark Prime Lending Rates (BPLR). You should ask what index will be used for setting the floating rate, how it has generally fluctuated in the past, and where it is published/disclosed. However, the past fluctuation of any index is not a guarantee for its future behavior.

Yes, most banks allow you to repay the loan ahead of schedule by making lump sum payments. However, many banks charge early repayment penalties up to 2-3% of the principal amount outstanding. Prepayment penalty may vary according to the reasons and source of funds – if you obtain a loan from another bank for pre-payment the charges are usually higher than when you pay from your own sources. However, you may credit more than your EMI amount into your loan account on a periodic basis and bring down your interest burden as and when funds are available with you. Most banks do not charge a pre-payment penalty if you deposit more than your EMI payable on a periodic basis. Please check such stipulations while availing the loan.

When other banks reduce the interest rate, you may prefer to close your account with the bank with whom you are banking, to avail of the loan from the bank offering reduced rates of interest. You have to pay pre-payment charges for doing so. In order to ensure that their customers do not approach other banks for availing reduced interest rates, banks allow customers to switch over from a higher interest loan to a lower interest loan by paying a switch over fees which is lesser than the pre-payment charges. Generally switchover fee is taken as percentage of the outstanding loan amount.

Keep up-dating yourself on various changes in the home loan market. Visit the branch, discuss with the officials to get the best out of any changes in the home loan scenario.

Yes. Resident Indians are eligible for certain tax benefits on both principal and interest components of a loan under the Income Tax Act, 1961. Under the current laws, you are entitled to an income tax rebate for interest repayment up to Rs. 1,50,000 /- per annum. Moreover, you can get added tax benefits under Section 80 C on repayment of principal amount up to Rs. 1,00,000 /- per annum.

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