taking a home loan

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Page 1: Taking a home loan

Taking A Home Loan ?Be Prepared Before !

Page 2: Taking a home loan

Some Things To Keep In Mind

• Research on lenders.

• Loan tenures and EMIs.

• Loan approval and eligibility.

• Floating vs fixed interest rates.

• Home loan insurance.

Home Loans are the magic wands that help you buy a dream home, but you have to

choose the correct wand which suits you. Despite there being a lot of lenders available

in the market, choosing a lender is not a walk in a park.

Page 3: Taking a home loan

Research

Banks hold the key to unlock your dream home,and always woo customers with lucrative schemesand low interest rates.

It is therefore your responsibility to gather asmuch information about the different plans offeredby different banks as possible to get the best deal.

Also, don’t be in a hurry to sign on the dotted line –clear all doubts with the bank before you take theplunge.

Page 4: Taking a home loan

EMI & Tenures

Going over budget will increase your EMI and causeyou great financial stress. Therefore, it is alwaysimportant to keep the EMI affordable so that it doesn’tbecome a huge burden on you and your family.

Another crucial decision that affects the EMI is thetenure of the loan. Increasing the tenure of the loanobviously reduces the EMI, but you end up paying moreinterest which increases the overall cost of your home.Therefore, strike an equitable balance between thetenure and the EMI amount.

Page 5: Taking a home loan

Loan Approval &Eligibility

It is advantageous to have your home loan pre-approved so as to not run into any trouble at thetime of booking your home.

Even more important is to ensure that your creditscore is healthy so that your loan applicationdoesn’t get rejected by the bank.

Page 6: Taking a home loan

Floating VS Fixed

Another important decision you will have to makewhile taking a home loan is whether to go for afixed or floating interest rate.

As the name suggests, fixed rates remain stable(for a time-period specified in the loan agreementby the bank, after which it may be revised), whilefloating rates are tied to the base rates of thecentral bank.

To choose between the two, understanding ofmarket trends comes in handy.

Page 7: Taking a home loan

Home Loan Insurance

And lastly, don’t forget to insure your home loan asit will be immensely helpful in case of anunfortunate calamity.

If the primary loan applicant passes away, his/herdependents may be stuck with an outstanding loanamount.

However, if you’ve taken home loan insurance, theinsurance company will help you in re-paying theoutstanding amount back.