Everyone dreams of buying their own home. Everyone wants to get a cheap and beautiful home. If you are also planning to buy your own house and are thinking of taking a loan for this, you need to plan how much loan you will have to take, what will be the amount of EMI, etc.
What is home loan and EMI?
The amount that a customer pays to the bank after taking a home loan includes the interest rate and the principal, which is called equal monthly installment or EMI.
How will banks decide how much customers should get?
If you also want to take a loan to buy a house, you must first determine how much your income will be. Banks give loans according to your earnings. Banks provide loans according to how easily you can repay the loan. This is because your monthly income, expenses and family income depend on things like assets, liabilities and income stability.
Is an applicant required for a home loan?
In most cases, an applicant is required for a home loan. Anyone in the homeowner’s family can be an applicant. On the other hand, if the house is in the name of two people, then both names need to be included in the home loan.
How do you get the amount of home?
The amount of home loan is given to the customers exclusively or in installments. If you get it in installments, you will get the full amount in at least three installments. When the property is ready for transfer, the loan amount can be received in a single amount. However, if your property is currently under construction, the amount is paid to the customer according to the progress of construction. In such a situation, the customer can make an agreement with the bank that the amount of home loan should be given to the manufacturer according to the construction.
What documents are required for a home loan?
The following documents are required along with the application form for home loans –
Residence proof (Aadhaar card, passport, driving license, electricity bill, ration card, etc.)
Proof of age (Aadhaar card, passport, driving license, PAN card etc.)
Statement of the last six months of the bank including Form 16 or income tax return
For this, some institutions also require mortgage or life insurance policy, share papers, NSC, mutual fund, bank deposit or other investment documents.
What are the types of interest rates for home loans?
For loan interest rates, you can choose between a fixed rate home loan and a floating rate home loan. In fixed-rate home loans, your EMI does not change over the term of the entire loan. This could prove to be beneficial as interest rates are likely to move forward. At the same time, the interest rate on your home loan is decided based on the floating rate along with the base rate. In such a situation, fluctuations in the base rate affect the EMI. It is beneficial to expect interest rates to come down in the future.
How do you decide which donor should take your home?
If you also want to take a home loan, say that there are many loan options in the market. Consider all these options at once. You should also pay attention to whether the donor organization is public or private. In addition, you need to keep track of how much interest a company is offering you and on what terms.
What to do to give EMI on time?
You should save the amount as an emergency fund to pay the EMI on time. This fund can help you to face financial crisis. If something bad happens in your life, such as if you lose your job or you get sick, this fund can be effective for you. This will not affect your ability to repay.
Can customers stop home loans prematurely?
If the customer wishes, the home loan can be closed before the expiration date. If customers choose the floating interest rate, they do not have to pay any price. At the same time, customers will be charged through the bank at a fixed rate.
What is the role of CIBIL score for I?
Banks check your CIBIL score before lending. It gives you an estimate of your financial strength and gives you an easy loan. So, correct your CIBL score before applying for a loan. If there is a delay in paying the EMI, our credit score also decreases, which makes it difficult to get the future.
How is the interest rate determined according to CIBIL score?
The EMI of the credit is determined according to the score given by the Credit Information Bureau of India (CIBIL). Suppose you have applied for a home loan from a bank and the bank’s interest rate is 8.35 percent. If your score is more than 760 points, you will get a home loan at an interest rate of 8.35 per cent for get 725 to 759 points, 8.85 per cent and below 724 points at an interest rate of 9.35 per cent. If you are applying for a loan for the first time or do not have a credit score of any kind, the bank will charge 8.85% interest.