What is the process to choose a home loan in your city?
Applying for home loan has never been easier, which you have estimated for your plot purchase & house construction .For taking home loans you have to do a lot of hard work .So we are covering here some points which will be helpful for you to choose the best home loan.
Guide for home loan:-
The people who are buying home loan for them this article will help to guide to choose the best home loan.
Making List of financial institutions:- Make a list of banks or financial institutions which have a branch in your city from where you can apply for home loans & easily repayment. You can search through online to know some of the details. But again you have to visit bank because loan requirement is always different for different person.
Search for details:-Then approach different banks and financial institutions to know their details of providing home loans. for this different banks have different schemes .Ask them for what is the amount of loan they can give you for your home construction. Generally it is 80-85% of the total construction expenditure. Another thing is important for you to know are EMI & interest rate. Also check the administrative & processing charges too. And also enquire about fixed & floating interest rates.
Eligibility:-TO get your home loan there are certain eligibility criteria .The eligibility to get a home loan mostly depends upon your credit score, your repayment capacity.
Credit score:-A credit score is a numerical expression based on a level analysis of a credit file, to represent the creditworthiness of an individual. Lenders use credit scores to determine who qualifies for a loan, at what interest rate, and what credit limits. Generally the credit score lies between 300-900 & higher the score a person is considered to be more financially trustworthy. If the credit score lies between 350-650. However a credit score more than 700 is considered as good .The more the credit score you will be more eligible to get your home loan. The factor that determine the credit score are Payment history which accounts for 35% weightage of credit score, length of credit history accounts for 15%,new account weights for 10%,account owed weights 30%,Types of credit in use weights for 10% of the total credit score.
Repayment period:-Decide your repayment period for your home loan. Generally longer the repayment period smaller will be the EMI. Remember that EMI should not exceed 50% of household income.
Then shortlist the banks:- Then shortlist the banks by looking their loan policy, which includes the amount up to which they can give loan, their EMI structure ,their interest rate, other terms and conditions regarding repayment of loan & loan sanction.
However choosing banks is not only helpful for you to get a home loan, you must be prepared to get a home loan by previously calculating the credit score.
After shortlisting ask the banks for the documents required to apply for home loan. And after applying check your status whether your home loan is sanctioned or not.
When you are sanctioned with a home loan you are also eligible for a tax rebate. So check out the tax concession you are eligible for, according to your sanctioned amount of loan.
Here we have given you a idea regarding what is the process to choose a home loan .So share your experience in choosing home loans in comment box.