Banks do not provide the entire amount you need to buy your home. You need to put up a certain part of the purchase cost from your side as well. Here is how to put together with your initial down payment.
- If you are not able to fully finance the margin amount, you can take a personal loan along with your home loan. This is possible if your monthly income is above Rs 10,000, or if you are a practicing professional. But personal loans being expensive and for a short tenure, are likely to drain your monthly resources. Take this option only when you have resources to pay off the personal loan from sources other than those taken into account for your home loan.
- You can provide adequate additional security by pledging liquid financial assets such as shares, securities, fixed deposits, insurance policies with existing high surrender values, etc. in lieu of the 10-15% margin money expected from you.
- You can obtain a loan against the surrender value of your life insurance policy from the life insurance company or from a bank.
- Some banks tie-up with specific, reputed builders who provide ready-to-move-in flats that include furniture, which would otherwise not be considered as part of the “cost of the house”. In such cases, subject to your income, you will be eligible for a bigger loan. Besides, this will also reduce your spending on these things when you move in.
- You could also take a loan from your Employees Provident Fund account if you have had an employee provident fund account for more than 5 years.