What is a Home Loan?

Everyone has a dream of owning their own house. However, not everyone has the necessary monetary support to purchase one. If you want to own a house for residential purpose, then you can opt for home loan at Rianshi Finserve. Home loans are secured loans. The financial institute will retain the property documents as collateral. You can simply compare top banks and NBFCs (non-banking financial companies) offers on housing loan and apply for the loan..

Things to Consider before You apply for a Home loan

Here are the things to remember before you apply for home loan urgent need based or planned basis:

• Home Loan Eligibility: The criteria for housing loan eligibility can be different as per personal profile and determined on basis of work stability, employment history, your age, income, credit history Check your home loan eligibility before applying for the loan.
• Loan Disbursal Time : It may take few days to process and disburse housing loan as there is a thorough check of documentation. Interest Rate (fixed or floating): Your loan provider can either charge fixed or floating interest rate. Fixed interest rates are best for short tenure, and floating rates for longer period. Hybrid home loans are where you can enjoy benefit of both floating and fixed rates.
• Terms and Conditions: There could be certain conditions regarding loan balance transfer, prepayment, repayment, and other things related to your housing loan. Know these in details before making a choice.
• Hidden Charges: The bank or NBFC can levy some charges such as processing charge or late payment charge etc. It is best to read the loan agreement before selecting the loan provider.

Features and Benefits of Home Loan

Below mentioned are some of the benefits of housing loan:

• Maximum Loan Amount: You can get 60 percent to 80 percent of the house’s purchase value. However, you need to pay 20 percent as down payment.
• Flexible Tenure: The tenure of home loan is one of the longest. You can repay between 1 year to 15 years and sometimes up to 20 years to 30 years. Repayment tenure depends on the home loan borrowed and other factors.
• Low Interest Rate: Since the loan is secured, the home loan rate of interest is low. At our website, you can get rates as low as 6.95%. The rate can be either fixed or floating or combination of the two.
• Tax Benefits on Home Loan: Under Section 24 of the Income Tax Act, you can claim exemptions in tax of up to Rs. 2 lakhs for EMI’s interest component paid in a financial year. Additionally, you can claim tax benefits of up to Rs. 1.5 lakh on principal amount paid under Section 80C of the Income Tax Home loan tax benefits are valid for co-applicant as well.
• Improve Home Loan Eligibility with Co-applicant: You can add your spouse or blood relative as co-applicant for the loan and improve your eligibility for securing home loan.

Types of Home Loans in India

Home loan is a broad category and there are various categories in it. Some banks and NBFCs offer loan to purchase new or existing property, while other offer loan based on borrower’s need for renovating the house and additional expenses. There are collateral free home loans as the housing loan is secured in nature and the lending institute retails the property papers as collateral.

Below are the sub-types of housing loan in India:

• Loan to Purchase House: This is the typical loan you can take to purchase new or old residential property. Tenure ranges from 1 year to 15 years and in some cases 30 years.
• Plot Loans/Land Purchase Loans: These loans are taken to buy land or plot for investment or construction. The funds are used to purchase vacant plot.
• Home Extension Loans: If you want to add more space to your house then you can choose home extension loan and extend your house area.
• Home Conversion Loans: If you own a house that has an existing housing loan, but plan to buy a new house, then you can take home conversion loan.
• Home Construction Loans: If you want home loan for constructing a house on a plot or land, then you can get sufficient funds in form of home construction loan.
• Home Improvement Loans: You can apply for a home loan to renovate or repair your current house.

Home Loan Eligibility Requirements

To be eligible for a home loan you need to check for home loan eligibility calculator and criteria. The housing loan eligibility will differ from one financial institute to other but broadly depend on your income, age, credit score, employment information etc. Housing loan is provided to self-employed, professional, salaried individual of Indian nationality.

• Income: You should have a regular source of income and display healthy repayment ability. For self-employed and businesspersons, the profit on business earned will decide the income limit for housing loan, and for salaried individual it is the monthly salary.
• Age: You as an applicant must be more than 21 years of age. Employment Experience: You should be employed with current employer for specific number of years, as asked by the financial institution.

Documents Needed for Home Loan

• Applying for home loan requires you to submit following documents, however, the documents required may differ depending on your employment type.
• Cost estimation or valuation report approved by the bank of NBFC.
• Copy of documents giving approval to proposed construction/extension plan.
• Filed and signed home online loans application form. Recent invest proof (if any). Recent passport sized photographs.
• Last 6 months salary slips, salary account statement for salaried individuals.
• Proof of identity such as copy of voters ID card, PAN Card, Aadhar Card, Driving license NOC letter from society/builder/municipal, allotment letter given by housing board etc.
• IT department acknowledged copies of documents such as sales receipts, profit and loss statement certified by legit authority.
• Acceptable address proof such as government issues ID proofs, utility bills, electricity bill etc.

Home Loan Interest Rates

• The home loan interest rates bases on marginal cost of lending rate (MCLR) plus a spread on the MCLR that depends on lender’s risk perception about the borrower.
• The housing loan providers can either offer fixed or floating interest rate today. Floating interest rate change with market conditions whereas fixed rates remain fixed and do not change. You can choose either as per the available options for the loan provided by the lender.