Must Read Points to Compare Home Loans

Taking a home loan is not a one time decision like eating an ice cream, as the moment passes so does the ice cream. It is a decision that you have to bear for many years; the whole repayment tenure may lead up to 10 to 20 years. How to make the right decision of selecting the best home loan?

Few important points to consider when you compare various banks and lending institutions and select the best offer to apply for a home loan.

Eligibility – you are eligible for which loan and the amount you can avail as loan. This will indicate your financial standing or repayment capacity, age, qualification and incoming salary every month. Only when you fit in these criteria will the lender offer you a home loan. So first check whether you are eligible for this loan and then apply only to those institutions who are willing to offer you a home loan.

Documents required for applying for loan- Enquire before hand about the documents required for this and whether you have all these ready. This information can be got from any financial advisers or any administrative assistants of lenders. One can also get information from the internet from various websites of banks or private lenders.

Interest rates – select the best suited to you. Compare, tally and weigh all the pros and cons of interest rates before choosing any lender. You will see a wide variation in loans offered at different interest rates. Study the repayment structure, penalties during pre payment and fees for late payments of EMIs.

Fixed or floating interest loans- This will depend upon your monthly incoming salary and total income. Whether you are comfortable with fixed or flexible rate of interest is totally your personal choice and this will depend upon your repayment capacity.

Other costs- Many other costs are listed in small below any agreements. Do consider all these and jot down these for calculation. Transfer fees, agreements, taxes and other administrative fees all will amount to a substantial figure.

Penalties- Late fees and pre closure of loans are two important points you will discuss before hand with the lender. In case you skip and EMI or wish to club EMIs what facilities are available for this, and in case you want to close you home loan or request to transfer your home loan to another lender do inquire about the penalty fees as this may be 0.5% or 1% of the total amount taken as loan.

After going through all these points compare all the offers by different lenders. Take separate quotations and then decide which suits you the best. Go ahead and then apply for a home loan and get that dream home you have on your wish list.

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Simple Comparison - Personal Loans and Home Loans

When you have to select the option of taking a home loan the very first question that comes in our mind is why not go in for a personal loan. This will be easily available and with less hassles. As well all know many financial loan lending institutions offer personal loans and that too at attractive interest rates then why go in for a home loan?

Research the internet and ask family members and friends especially those who have taken personal loans about the interest rates, the formalities and requirements for approval of such personal loans. Many institutions also offer personal loans at very short notice and even reputed private banks like the icici and other nationalized banks like State Bank offer personal loans. Here they see only the past financial history and track record of the individual borrower. Their credit card rating and income and assets are considered and immediately these loans are got without any hassles and personal loans are also termed very quick loans. The most important hitch here is about the interest rate with which these loans are offered. These are definitely more than any other loan rates. With a telephonic conversation an account holder or card holder can get a personal loan of certain amount, no questions asked, and that too within certain hours of time. 
If you need a quick loan then personal loans are the answer. Another important aspect here is that though you get the loan very fast and without any hassles you have less repayment period. You are given a time limit to repay the loan hence your EMIs will be on the higher side. This type of  quick personal loan is good for people who have financial backing or double income and can repay large sums as EMI keeping aside their monthly incoming money or salary for other household expenses. Here they get to repay the loan amount quickly and can own the property soon.

What about home loans and their interest rates? Documents are required and also processing time is more for approval of home loans as compared to personal loans. And we also know that administrative charges apply for home loans which the borrower has to arrange before approval of the loan. Home loans are the cheapest till date as compared to any other loan. Interest rates for home loans are still competitive and lower than any other loan. Here the borrower gets precious time and money to repay the home loan as the repayment tenure and EMIs are adjustable according to the individual borrower and their repayment capacity. EMIs are comparatively smaller than personal loans as the schedule for repayment falls in 10, 20 or 30 years depending upon the loan amount and the age of the borrower along with their qualifications and job status.

Both types of loans have their good points and bad points. Personal loans are very good when you have a tight crunch suddenly and can come out of this with some money immediately. So if you need cash right away then personal loans are the answer. But if you have to repay in installments and that too within your budget then home loans are better. In fact for buying a house, only home loans are the best option available till date. Personal loans are good for smaller amounts of money and when you have to spend crores for a flat then home loans are the best option to choose.

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Easy Home Loans Repayment Guide

Home loans are an easy way to purchase homes. Easy availabilty of home loans and cheap loans have made the buyer very lucky to make purchases at their own free will. Taking a loan is one thing and repaying is another. Let us discuss few tips to guide the loan taker for repayment of the home loan.

Easy Home Loan Repayment Guide

1) Plan the purchase of the home:. Timing is most important. Be prepared after marraige or before and start saving for the loan repayment.
2) Invest in short term and long term investments:b Short term for paying the down payment. It is advisable to keep these investments with flexible option of liquid cash. Long term to consider the inflation and also to pay the heavy EMIs in case of emergencies in later years of repayment of home loan.
3) Assess critically your financial condition: Dreaming of a big bunglow may be good but do you need the bigger house and is the financial position so strong to repay the large sums of EMIs every month.
4) Critically analyse your area requirements: Which area flat will be suitable for you and which rates per square feet are affordable within your budget.
5) Latest amenities like club house and swimming pools: I have personally observed swimming pools in later years become dumping trash bins! do you lead a life style where you use such amenmities. Otehrwise they are a waste and you pay more every month for this . Even after the purchase you keep paying maintenance for these amenities.
6) Other expenses: Very very important. Home loans are not the only expenses. Always keep in mind that life goes on. Taking a loan does not stop you from basic expenses which are compulsory like food, clothing, entertainment and so on and so forth! Also if starting a family then these expenses will also add up in the monthly expenses.
7) Other loans: It may be possible that you have gone in for a personal loan during renovation, or maybe a car loan for a preowned vehicle. Keep an account of these loans and always remember that taking a home loan or any othe rloan comes to a much higher figure with added interest amount.
It is most advisable to keep the habit of taking loans to the minimum and only when required. Also try to bring the loan amount to the maximum lowest possible for easy repayment of home loan.

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Taking a Home Loan for House Under Construction.

Taking a home loan for house under construction can have various loop holes which come in the lime light only later. Homes are built by people and only houses can be built by builders. All of us understand that buying a new home is a very emotional aspect in an individuals life. Many of us consider taking a home but the finances are never sufficient as the rates of property are shooting up till the sky. Home loans came as a boon for us and we can think of purchasing that dream home with loan amount which other wise we would not have dreamt of.
The property under construction always has lesser per square feet amount than purchasing an outright  house. The booking amount is calculated per square feet according to the rate going on in that particular area. Loans can be taken according to this rate and EMI's calculated for the convenience of payments every month for the period or years decided according to the loan repayment schedule. Every thing is calcualted till the last detail and every month the purchaser goes and views the progress taking place in the construction. Many of the people may be staying in rented flats and also have to pay the EMI amounts along with their rent.
What happens when the building under costruction comes in some legal dispute?
well it becomes very difficult to pay the EMI's as well as the rent for an increased number of months. The customer is also very afraid about when the decision of legal matter will be settled and when they will take possession of their new flat. Definately legal battles take up much more time than expected and is always very stressful for the home loan borrower. Sometimes the whole propertyy is taken over by some other builder and they have their own terms and conditions. Here the customer has the option to take an amount offered by the builder and leave but it is always lesser than the house amount that can be got on purchasing the flat. If the purchaser goes in for continuing then they have to amend the rules and prepare fresh documents according to the hand over of property.
Hence it is very much advisable to go in for purchasing flats from a reputed builder. Find out about the reputation of the builder over the years. Observe their ongoing property projects. Also consider visiiting their successful and completed projects to have a view of how the final flat will look. Taking a bet on new builders may come at a reasonable amount and even lesser per sqare feet rate as also they may offer may latest amenities but it is always the insecure future that has to be considered before purchasing a new flat and going in for a home loan.

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Divorce of a New Couple: Reason Home Loan

One of the most important adjustments that a newly married couple has to make is that regarding finances. Our priorities vary and one may feel the need for dining out important whereas other may place priority to travelling to exotic places and may be willing to have simple home cooked food. Whatever the likes and dislikes of the newly married couple, a home loan taken for the dream home is the most important decision in ones beginning of new life. Sacrificing certain important aspects during the early-years of marriage may build up over the time. Constant fights over finances may make the relationship sour and the pressure of the home loan may also sometimes go off hand and lead to separation of the couple. Let us discuss few tips to neutralize the negativity among couples and reduce the stress about repayment of home loan.

The decision of taking a home loan has already been done. The couple should sit down and have an open discussion regarding their priorities.  Financial planning is must for helping out in this situation. If one of the partners is unaware about the loan then it is possible that this partner may feel the other is cheating on them. Small bickering when fuelled daily may go out of reach and lead to divorce between the couple. Many adjustments have to be made as the couple is new to each other. Habits and manners are different as also the background that they come from.  ‘Looking at the dream home’ is the mantra for success and a tonic for the couple till the years of repayment are completed. Facing the fact that a home of ownership is waiting for us after some years is the bonus that is enough for both to carry on. Discussing other important aspects of life like increasing the family, health of elders and other positive points among the couple helps them to understand each other.

Having a dream and taking steps to fulfill them is the guideline and important tip for the couple to carry on in their relationship. Having frequent visits to the construction site and taking a look at the home under construction helps the couple to go ahead and be willing to sacrifice certain financial priorities in order to achieve a home.

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