Home Loan-3 Important Points You Must Analyze

Get Lowest Interest Rate for Your “HOME LOANS”

Lower Interest rates is often marketed as the most important Advantage while choosing your Home Loan Provider.

Studies have shown that the Consumer often Get carried away with excessive advertisements and many such customers conveniently ignore other facts that might be more important while making a BUYING DECISION.

We want to share with you 3 other important points which you must consider along with low interest rates while choosing a HOME LOAN provider.

  1. Repayment Tenure

Customers often opt for lower monthly EMIs and consequentially land up with longer repayment tenure.

After few years of regular repayment, These same customers are unpleasantly surprised to know that their principal loan amount has hardly reduced by just few thousands and the interest they have paid till now is in lakhs.

The repayment tenure and your EMIs go hand-in-hand. Longer tenure adversely increases the interest rate to be levied, resulting in you having to pay double or triple the loan amount due to high interest.

If you have a stable and increasing income,  your must choose a short repayment tenure with higher EMIs. Interest amount for such tenures are considerably lower.

If you explore deeply, Banks also might offer attractive interest rates for those who decide upon a shorter repayment cycle.

Remember this point and be practical in choosing your EMI and Tenure.

  1. Know The Part Payment and Foreclosure Norms

Few of the Banks and NBFCs charge a foreclosure fee if you opt to close the loan earlier than the committed tenure, discuss this in detail with the bank.

We are sure that you will find a option where there are no foreclosure charges.

Similarly also check for the part-payment fees.

Suppose you have earned some profit/bonus or got some extra cash on you which you would like to use to reduce your principal loan amount, in such situation

you should be allowed to pay in part your loan Amount without any fees or interest or any extra charges.

Also Such part payment should result in either reducing your EMI or Reducing your Repayment Tenure.

  1. Option to Reschedule your Loan

With falling interest rate trends, most of the banks offer a facility to their customers to reschedule their loan and opt for lower interest rate which prevails at that point of time.

for Eg. if while taking the loan your interest rate was 9% and now after few years home loan interest rates have come down to say 7%, you can choose to reschedule your loan by paying a nominal charge.

such rescheduling often result in reduction in loan tenure or will reduce your EMI amount.

Discuss this with your loan provider at the beginning itself and check if they have any clauses restricting such rescheduling.

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