What are the Benefits Of Housing Loans In India?

A Housing loan has always been the most practical approach for the Indian middle class households in order to secure their dream home. Yet, it cannot be taken lightly as it is a long financial commitment and the amount of investment required is sizable too. Hence, you must choose to customize your housing loan in a way such that it allows you to enjoy all the related benefits.

Housing Loans in India have several advantages. As a borrower starts paying his EMIs, the principal amount and the interest on his home loan get deducted from his taxable income for that financial year. Thus, he would end up paying lesser income tax for that particular year. If you jointly apply for your housing finance along with your spouse, then both of you can save money; meaning that you would need to pay a much lesser amount of income tax individually, thus saving a considerable sum at your disposal.

The amount of the home loan EMI is unique for each individual. In most cases, it is almost similar to the rent that people pay to their landlord. In other words, you could own the house that you pay rent for if you can manage the down payment for it. So instead of paying rent to the landlord, you would rather pay the EMIs to your housing finance company. You could thus own a home and enjoy the capital appreciation over time if you manage the payments for the loan successfully.

For majority of the people, it is the same financial scenario whether they decide to pay their landlord or a housing finance company. The common challenge is managing the 15 to 20% of the total value of the house for the down payment, qualifying for the home loan eligibility criteria and producing the required documents for the housing loan .

Most people perceive their home loan as a liability. In many ways, it is. However, it is a rewarding asset building process as well. In simple words, you can enjoy much higher capital appreciation as compared to other major securities in India. Therefore, you would earn a much bigger capital gain than the principle amount and interest that you would pay as part of the loan. Hence, it is extremely necessary to understand all the aspects of the home loan in order to make financially sound decisions. Knowledge is power, use it well.

Choose Your Home Loan Interest Rate Carefully

The questions that possibly come to your mind when you think of opting for housing finance are – ‘How much will I have to pay in the form of EMIs every month? Will I be able to afford it?’ These questions are answered to a large extent by the amount of home loan interest rates that we choose. If our home loan rates are chosen well, we have nothing to worry about in terms of our monthly repayments. With careful planning, a home loan can be exceedingly easy to pay off; however it’s imperative that we choose the best available home loan interest rates . This aspect of the home loan can be a huge deciding factor in understanding how our funds will be paid off in the years to come.

The amount we pay as EMIs every month certainly has an impact on our lifestyle. If your EMIs are too high, the other expenses would have to reduce drastically. This in turn causes your lifestyle to take a downslide and has you compromising on basic things at times. A home loan shouldn’t mean that you lose out on your quality of life in any way; on the other hand, it is supposed to make your life much better. The opposite, paying slightly low EMIs means that your loan is being stretched for a much longer duration than it has to and you’re, hence, paying back a lot more money than you borrowed. Why drag on the home loan for any longer than you have to? Make sure that your home loan rates are just right and choose the best option carefully.

You need to communicate your needs to the bank/financial institution so that they can help you with the kind of housing finance that is apt for you. It is essential to know the home loan amount that you’re eligible for so that you have a defined budget for the property you wish to buy. Then figure out how much you can afford to pay every month in the form of EMIs. This gives you a defined direction to choose the interest rates and loan tenure accurately. Bear in mind that it’s very important to plan out your monthly budget; since it’s the only way you’ll know whether or not your home loan is affordable.

It’s not as hard as it seems to find the perfect home loan rates in India . With a large variety of home loans available, you can easily pick an option that suits your financial situation. Look carefully and select the loan with the ideal home loan rates to make sure that your new home never feels like a burden.

Which Aspects To Consider While Looking For The Best Home Loan Rates?

Finalizing a home loan isn’t the easiest decision to make without any guidance. We need to ensure that we choose carefully, since this decision decides our financial future in more ways than one. A wrong move can cause us to be stuck with a finance option that may become unaffordable eventually and lead to an unavoidable financial debt. To ensure that we choose the best home loan, we would need to select the ideal rates of interest too. However, there are a few things that you have to bear in mind when choosing the best home loan rates in India .

The first thing that you have to know when choosing home loan rates is that the lowest rate may not always be the best. The kind of housing finance company that you choose also plays a significant part in the way your home loan is going to play out for you. Opting for the cheapest interest rate through an unreliable or untrustworthy lender can lead to many unfortunate incidents. You need to be sure that the financial institution that you’re choosing has an absolutely transparent way of dealing with matters related to loans. Some lenders might seem inviting with low interest rates but will have so many loopholes in their documents that you may end up losing more money than you tried to save.

Another thing to remember when comparing housing loan interest rates is to keep the other features in mind. You might have two options that cost almost the same amount, but the one that’s slightly more expensive could have additional benefits. It’s quite common for some housing finance companies to offer an insurance policy or bank account deals along with their loan. It’s important that you consider such factors before making a choice. If you’re getting additional features besides the loan, why not consider opting for that alternative and paying a slightly higher amount?

Home loan interest rates are not completely black or white. They are certainly a lot of other shades in between and hence, we have to ensure that we look at the broader picture when we are making a decision. You need to make sure that you choose a finance company that is not going to cause you any financial harm, whilst cautiously examining all the aspects of the home loan option before choosing or disregarding it. Home loan rates in India are varied, select the best for your situation.