Five things to consider while applying for home loans in India

applying for home loans in India

Whether it’s buying a new flat or renovate your house, home loans in India can help you meet your funds. No matter if you’re a first-time home loan borrower or not, if you don’t have enough knowledge on the subject, it will give you sleepless nights. Secondly, the competition is quite stiff amongst the peer players and often it becomes a daunting task to decide: Which are the best home loans at your disposal? Thanks to the aggregator sites that have made your job easy and convenient. You can compare quotes of top banks & financial institutes in terms of interest rates, processing fee, loan amount, tenure and other key factors, right from the comfort of your home or offices.

Here are five tips that will smoothen your application process:

Maintain the list of documents

Before making an application, whether in-person or online, it is wise to keep all your required documents ready and organized. The loan lenders require your financial statements, salary certification and KYC documents such as Aadhar card, PAN card, passport, voter’s id, driver’s license, etc. Under salary documents they would need past 3 month’s pay slip, 6 month’s bank statement, and income tax returns statement. They would go through your bank statement as well to determine your financial stability.

Your CIBIL score

An excellent CIBIL score of around 800+ can help you avail some of the best home loans in the town. Lenders come up with pre-approved loan deal for such customers. They will ask your credit rating to know whether you’re financially capable to pay back the loan taken or not. It’s like a report card which displays your creditworthiness and repayment history, defaults. If your score is lower, simple measures like speaking to financial expert, clearing dues will improve your credit score.

Qualified to take a loan or not?

Once you know that you have a good credit score, you can go ahead with the application preparation. However, there are other factors as well that will decide if you’re qualified for home loans in India or not. These include your age, income source, employment type, stability, financial commitments, number of dependents, property value, etc. Lenders will evaluate these facts and then inform you how much loan you will be qualified for? And the rate of interest.

Check the interest rate and its type

Interest rates play a key role in deciding the best home loans for the borrowers. You need to find out the interest rates the lenders are charging on the principal amount. There are online calculators that will give a gist of the complete interest outgo. Check with other lenders what concession they’re able to give you? And choose the perfect one for you based on your affordability. You can save thousands of rupees in the long run. Choose between floating or fixed interest rates based on your risk potential, current, and future income source.

Compare Quotes

The growing competition amongst top banks and housing finance companies acts as a boon for the borrowers. They have come up with festive, promotional, and seasonal discounts. So, it’s the customer who stays on the winning side with round the year deals. When you compare quotes, it will help you grab a deal based on your affordability. So, compare online and then take a wise call.

Hope these five tips will help you to avail the best home loans in India!