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Home Loan
A house is a big financial decision, and a home loan plays an important role. A Home Loan loan is useful in getting a lump sum amount for the house purchase. Based on your repayment capacity, property value and many other factors, the bank provides you with a home loan amount. And you don’t need to hurry to pay off the borrowed amount, as there is a long tenure from 10-30 years. This article will help you understand the Home Loan and how it can help you buy a house.
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Top Home Loan Providers
Research and Get the Best Offer while applying for a home loan. Check and compare the interest rates, processing charges, and other terms and conditions of multiple housing finance companies. It helps you get the best rate, so you are okay with paying extra later. Remember, the lowest interest rate is one factor that makes up the best loan plan. So, you must compare different banks and NBFCs offering similar interest rates and compare their loan amounts.
Top Home Loan Providers
Research and Get the Best Offer while applying for a home loan. Check and compare the interest rates, processing charges, and other terms and conditions of multiple housing finance companies. It helps you get the best rate, so you are okay with paying extra later. Remember, the lowest interest rate is one factor that makes up the best loan plan. So, you must compare different banks and NBFCs offering similar interest rates and compare their loan amounts, repayment terms, and other conditions before finalising the loan. Below is the list of top home loan providers which you can approach when considering financing your house purchase
| Name of the Bank/NBFC | Interest Rate | Loan Amount | Tenure | Processing Fee |
| ICICI Bank Personal Loan | 10.75% p.a. onwards | Up to INR 50 Lakhs | Min:- 1 Year Max:- 6 Years | Up to 2.5% of the Loan Amount |
| Kotak Mahindra Bank Personal Loan | 10.99% p.a. onwards | Up to INR 25 Lakhs | Min:- 1 Year Max:- 5 Years | Up to 3% of the Loan Amount |
| Axis Bank Personal Loan | 10.25% p.a. onwards | Up to INR 40 Lakhs | Min:- 1 Year Max:- 5 Years | Up to 2% of the Loan Amount |
| IDFC First Bank Personal Loan | 10.49% p.a. onwards | Up to INR 1 Crore | Up to 5 Years | Up to 3.5% of the Loan Amount |
| HDFC Bank Personal Loan | 11% p.a. onwards | Up to INR 40 Lakhs | Up to 6 Years | Up to INR 4999 |
| Yes Bank Personal Loan | 10.99% p.a. onwards | Up to INR 40 Lakhs | Min:- 1 Year Max:- 5 Years | As per the Bank’s Norms |
| Bajaj Finserv Personal Loan | 13% p.a. Onwards (Salaried) 17% p.a. Onwards (Non-Salaried) | Up to INR 25 Lakhs (Salaried) Up to INR 45 Lakhs (Non-Salaried) | Up to 5 Years (Salaried) Up to 7 Years (Non-Salaried) | Up to 4% of the Loan Amount |
| Tata Capital Personal Loan | 10.99% p.a. onwards | Up to INR 35 Lakhs | Up to 6 Years | Up to 2.75% of the Loan Amount |
| Aditya Birla Finance Personal Loan | 13% p.a. onwards | Up to INR 50 Lakhs | Up to 7 Years | Up to 3% of the Loan Amount |
| Incred Personal Loan | 11.49% p.a. onwards | Up to INR 15 Lakhs | Up to 7 Years | As per the Bank’s Norms |
| Paysense Personal Loan | 2.3% onwards per month | Up to INR 4 Lakhs | Up to 540 Days | Up to 3% of the Loan Amount |
| Finnable Personal Loan | 16% p.a. onwards | Up to INR 10 Lakhs | Min:- 6 Months Max:- 5 Years | Up to 4% of the Loan Amount |
| Upward Personal Loan | 18% p.a. onwards | Up to INR 7 Lakhs | Up to 5 Years | As per the Company’s Norms |
| Finzy Personal Loan | 18% p.a. onwards | Up to INR 5 Lakhs | Up to 3 Years | Up to 5% of the Loan Amount |
| Ashv Finance Personal Loan | 18% p.a. onwards | Up to INR 7 Lakhs | Min:- 2 Year Max:- 5 Years | As per the Company’s Norms |
| AU Small Finance Bank Personal Loan | Up to 30% per annum | Up to INR 7.5 Lakhs | Min:- 1 Year Max:- 5 Years | Up to 5% of the Loan Amount |
| IndusInd Bank Personal Loan | 10.49% p.a. onwards | Up to INR 25 Lakhs | Min:- 1 Year Max:- 5 Years | Up to 3% of the Loan Amount |
| Fullerton Personal Loan | 11.99% p.a. onwards | Up to INR 30 Lakhs | Up to 5 Years | Up to 6% of the Loan Amount |
| RBL Bank Personal Loan | 17.50% p.a. onwards | Up to INR 20 Lakhs | Min:- 1 Year Max:- 5 Years | Up to 2% of the Loan Amount |
| Home Credit Personal Loan | 2% onwards per month | Up to INR 5 Lakhs | Min:- 6 Months Max:- 4 Years | Up to 5% of the Loan Amount |
| Citibank Personal Loan | 10.75% p.a. onwards | Up to INR 30 Lakhs | Min:- 1 Year Max:- 5 Years | Up to 2% of the Loan Amount |
| Ujjivan Small Finance Bank Personal Loan | 11.49% p.a. onwards | Up to INR 10 Lakhs | Up to 5 Years | Up to 2% of the Loan Amount |
| Standard Chartered Bank Personal Loan | 11.49% p.a. onwards | Up to INR 50 Lakhs | Up to 5 Years | Up to 2.25% of the Loan Amount |
| Punjab National Bank Personal Loan | Up to 15.85% per annum | Up to INR 20 Lakhs | Up to 5 Years | Up to 1% of the Loan Amount |
| SBI Personal Loan | 10.30% p.a. onwards | Up to INR 20 Lakhs | Up to 6 Years | Up to 1.5% of the Loan Amount |
| Bank of Baroda Personal Loan | Up to 17.05% per annum | Up to INR 20 Lakhs | Up to 6 Years | Up to 2% of the Loan Amount |
| Bank of India Personal Loan | 12.75% p.a. onwards | Up to INR 20 Lakhs | Up to 3 Years | Up to 2% of the Loan Amount |
| IDBI Personal Loan | Up to 14% per annum | Up to INR 5 Lakhs | Min:- 1 Year Max:- 5 Years | Up to 1% of the Loan Amount |
| Union Bank of India Personal Loan | 10.30% p.a. onwards | Up to INR 15 Lakhs | Up to 5 Years | Up to 1% of the Loan Amount |
| IIFL Personal Loan | 14.25% p.a. onwards | Up to INR 5 Lakhs | Up to 3 Years | As per the Company’s Norms |
Overview
In order to apply for a business loan, you need to check these things off your list:
Choose the bank with the lowest housing loan interest rate. A home loan with a lower rate slashes the EMI amount and helps you pay off the loan. However, it is important to remember that the Home Loan interest rate is not fixed and may change during your loan tenure.
You can apply for a Home Loan loan for up to 80% of the cost of the property. It means you must pay the rest of the amount from your pocket. In some instances, you may even be able to get a Home Loan loan for the entire value of the property. However, this will depend on your income, age, credit score, employment history and loan provider.
The Home Loan loan tenure is generally 5 to 30 years. And choosing a term determines the monthly Home Loan loan EMIs you will be paying. A longer Home Loan tenure will result in lower EMIs, but it also means that you will pay more interest on your Home Loan loan as time passes. On the other hand, a shorter Home Loan loan tenure means higher EMIs, but you will save on interest payments in the course of your repayment period. As a borrower, you can use an online Home Loan eligibility calculator or ask your lender to provide a loan tailored to your needs. Before choosing a lender, approach at least three to five lenders to obtain the best home loan possible.
Home Loan loans have a prepayment facility for you borrowers with which you can reduce your loan balance. Banks charge 2-3% of the loan balance if you prepay your Home Loan loan. However, some banks don’t levy these charges on your Home Loan. Therefore, check these charges if you plan to sell your property or refinance your Home Loan.
A Home Loan processing fee is a non-refundable charge ranging from 0.5 to 1% of the total loan amount. You have to pay this charge upfront. Sometimes, this fee may be added to the Home Loan loan principal, and you will have to pay interest over it based on your lender’s terms and conditions.
If you’re approaching a lender to apply for a Home Loan loan, you will generally need to make a down payment of 10-20% of the total loan amount. The down payment can be made using – savings and investments you have. In some instances, you may even be able to get a Home Loan loan with no down payment. However, the bank will allow the same based on income, age, credit score, and employment history.
The amount of Home Loan loan you will be eligible for is determined by these criteria –
- Income – The income determines whether you can pay off the borrowed amount.
- Age – The age criterion helps the bank shortlist the applicants based on their income life. A younger applicant has more income life than an individual near their retirement age.
- Credit score – The three-digit number lets the bank know your repayment record. A score of 750+ makes you a highly eligible applicant. Whereas a score below 750 indicates some discrepancies in your previous repayments.
- Tenure – The longer the tenure, the lower your monthly instalment for a Home Loan will be, and vice versa with a shorter tenure. You’ll be able to apply for a longer tenure if you’re younger. An applicant in their 70s can’t apply for a home loan with a tenure of 30 years. So consider this while applying for a loan.
- Assets – Your property serves as an asset in a home loan. When you buy a high value property, it will be decided based on that. And as the property you’re buying is in demand, the bank won’t face any problems while compensating the loan amount in case of default.
- Employment status (Self-employed and Salaried) – Income will impact your borrowing money for the house purchase. So it is wise to include your spouse’s wages as a co-applicant to the loan. This way, you can increase your chances of getting a home loan without trouble.
The following documents are required to apply for a Home Loan –
For Salaried
– Identity Documents: PAN Card, Aadhaar Card
– Address Proof: Electricity bill for owned premises/Rent agreement for Rented premises/Passport
– Income Documents: Salary slip of the latest month
– Bank Account Statement: Salary credit bank account statement of latest three months
– Property Documents: If already finalised along with legal & technical clearance of the property
For Self-Employed
– Identity Documents: PAN Card, Aadhaar Card
– Address Proof: Electricity bill for owned premises/Rent agreement for Rented premises/Passport
– Income Documents: Income Tax Returns along with computation for the latest two years, Profit/Loss statement and balance sheet for the latest two years
– Bank Account Statement: Operative bank account statement for the latest six months
– Property Documents: If already finalised along with legal & technical clearance of the property
Before you finalise your home loan amount or sign the papers, know the exact amount with a home loan EMI calculator. A home loan EMI calculator is an online tool to compute your monthly instalment for your loan. Three aspects determine your loan EMIs; these are:
Principal
The principal is the loan amount you will borrow from the bank. The cost of the home minus the downpayment is your principal amount. Suppose you want to buy a house worth Rs 60,00,000 and have Rs 20,00,000 for the down payment; Rs 40,00,000 is your loan principal. The principal amount depends on your home value, savings and the bank’s policies. Banks sanction 80-90% of the house value as a home loan. Housing finance companies and banks calculate instalments on the principal and the more you borrow, the higher your EMI will be.
Loan Term
The number of years you choose to repay the loan is known as the loan tenure. You can use the EMI calculator to check various loan duration options to evaluate whether the monthly instalment fits your budget.
Interest Rate
The loan interest rate also influences your overall EMI. Interest rates are not something that is not in your control. Your bank decides the rate of interest. However, you can compare various banks to find one which offers you the lowest rates keeping other aspects in mind.
How To Calculate EMI with a Home Loan EMI Calculator?
A home loan EMI calculator can help you estimate your EMIs, follow these steps –
– Enter the principal, loan term, and interest rate in the respective fields
– Click the ‘calculate’ button and you will get your monthly instalment. You can adjust the principal and loan term amount and check the EMIs for different combinations.
Benefits Of Using A EMI Calculator
Using a home loan EMI calculator has some benefits, some of which are discussed below:
– No Need For Manual Calculations
Manual calculation of your monthly instalment can be tedious and time-consuming. Any mistake could derail your decision-making, and you would have to live with it for many years. If you want to compare different tenures or rates, making many calculations and reviewing them to check their accuracy would be challenging. With the calculator, you can get accurate results instantaneously.
– Finding The Best Deal Is Easier
Any change in the interest rate by even one-tenth of a per cent could make a difference to the overall loan cost and the monthly instalment. You can compare different lenders and decide which one to choose, considering factors like the overall difference in the loan interest and other expenses.
– Financial Planning
With an EMI calculator, you can plan your finances better. You know exactly how much you must pay for the next 10-30 years as an EMI. This can help you budget your expenses, reduce your loan amount or increase your tenure, as the case may be.
Compare loan offers from various housing finance companies and plan your home purchase. Thorough research and a good understanding of any product help you make an informed choice.
FAQs
In order to apply for a business loan, you need to check these things off your list:
EBLR is an External Benchmark Lending Rate linked to floating-rate home loans.
Yes, they can if they have chosen a floating rate of interest.
Your home loan rate of interest changes as per the bank’s guidelines.
It is not a home loan product but a new interest rate structure for borrowers.
You can apply for a top-up loan to meet the additional requirements.
The top-up loan will be based on your repayment record, which may range from INR 50,000 to 10 Lakh based on your lender.
Yes, you can get online approval for a home loan if your bank provides this facility.
You can find your home loan eligibility by going through the bank’s home loan requirements mentioned on their website or using their eligibility calculator.
Your EMI is based on the loan amount you apply for, and the interest rate applied on the same. You can find an apt EMI amount by choosing a suitable loan tenure. You can know your EMI in advance using a home loan EMI calculator.
Your savings will be detrimental to your new lender’s rate of interest and balance transfer fee.
Yes, under government regulations, women borrowers will get lower interest rates.
