HOW TO SECURE YOUR HOME LOAN?

With the high competition between banks it has become so easy to raise a home loan for purchase of property in a week days of time with the best and least home loan interest rates, but the actual challenge lays post disbursement of the loan. There are people who sold their property or left them to bank due to failure of EMI payments. These are some cases where people are suffering for not knowing how to manage the loan post home loan disbursement.

The process of securing your housing loans starts from the day 1 when you start the housing loans process. Every customer is advised to take photo copies of all documents submitted to bank and keep it for future references and cross check the home loan rates with other banks before applying.  Most of the customers sign the home loan applications and agreements when they are blank which is not at all suggestible, will you sign a blank cheque without writing anything and give it to somebody then why you are ok to sign the housing loans agreement without filling it, ask the bank officials to fill the agreement and then sign it.

All the customers will sign two copies of home loan agreements one of which will be received by customer post housing loans disbursement. The agreement will have all the details of your loan and their terms i.e. loan amount, interest rate, repayment period, EMI, Processing fee paid, list of documents deposited etc. one should retain this copy of agreement till the loan completion. The agreement will have a copy of General Power of Attorney which should be read before signing if any clause is objectionable to you then you can ask bank for a clarification.

Along with these one should make more down payment towards the property and raise lesser loan amount which will ease the process of making EMI payments and gives us the scope of saving to pre close the loan. On a blink calculation any customers who go for housing loans will pay 125% of the loan amount as interest to the bank. So opting for lesser loan amount will save money and will secure the loan. It is always advisable to the customer to opt for Home Loan Linked Life Insurance which covers the loan amount in case of death of the applicant and waves the remaining EMI’s by releasing the property from the bank. Banks fund for these insurances along with housing loans and it is a onetime premium which will secure both the housing loans and applicant’s loan burden.

{Source: http://myloandetails.com/blog/how-to-secure-your-home-loan/}

Why is interest rate a deciding factor in home loans.

A house in a prime locality which is nearby to the various hubs is every man’s dream. There has been increase in the home loan since last two decades. The home loans provide flexibility to the buyers and are affordable to them. As buying a home completely on the savings is impossible, the home loans provide financial help. Unlike the personal and traditional finance the homes loan rates offer flexibility in the interest rates, the tenure of repayment, the mode of repayment this has increased the number of home loan substantially.

Various banks and non-banking financial institutions have been offering home loans rates that range between 9-10 % with a mere processing fee of 1-2 % of the loan amount. These banks and non banking institutions customize the housing loans as per the needs of the customers. Whenever a bank sanctions you a home the amount of the home loan which gets sanctioned depends on various factors like the location of the property, the age of the property at the sanctioning of the loan, the age  of the property at the maturity of the loan , the age of the customer, the customer’s profile and so on.

The home loans rates are a function of the principal loan amount, the tenure of the repayment. As home loan requires long term commitment it is necessary to check the interest rate before availing for the home loan. Because the person might feel burdened with time hence, he should always check the interest rate see whether it is affordable to him and then avail for a home loan.  The banks check the credit score of a person before they sanction him a loan. If the person has good credit score there is no problem while availing the loan.

In case the person has not paid the EMIs on time the bank might reconsider before giving the loan. He can also negotiate with the bank for lesser home loans rates if he has paid his EMIs regularly. The individual does not need to waste time as home loans have become more feasible because all the information regarding the home loans have been available on the online sites of the lending institutions. The person need not go manually to apply for a home loan he can simply fill up the form which is available online. The information which is to be filled should be correct and not fabricated then the he can apply for the loan and wait for the next 15 days to get response from the lender.

The person will get a call from the bank or the non-banking regarding the approval of the loan. He can even contact the customer care executive about the same. The person can even visit the online comparing websites and compare the home loans rates online. This way he can avail for a loan which best suits his needs. Lower the interest rate lower will be the burden of the home loan for the person.  Even a 0.50 % of reduction in the interest rate can help a person save lot of money.

The Road to Welcome Home.

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Can I Qualify For A Home Loan At Low Credit Score?

Usually, it is believed if you have a low credit score, you don’t qualify for a home loan.  Some people even don’t apply for the home loan if their CIBIL score falls below 650 because of fear of disapproval. Lenders usually charge a high rate of interest in this case. If your credit score is above 700 out of 900, then only you make a winning home loan application.

But, in a developing country like India, many people don’t have good credit score. Their rejection at the lender’s end is a big concern. To sort out this problem, housing finance players bring forth several home loan schemes, where housing finance is possible even at low credit score. Let’s find out how is this possible.

Some housing finance lenders provide home loans to low CIBIL scorers, subject to a plenty of terms & conditions. The obligation can be in the form of a high-interest rate or more income and verification documents etc. The low score indicates insecurity on the part of the aspirants and thus, they need to do lots of homework to regain back their credit position.

However, if one wants to avail home loans with low credit score immediately, he can approach for Swaraj Home Loans launched by IIFL HOUSING FINANCE.’ This product caters to first-time home buyers, who may or may not be supported by formal income documentation and have poor credit history. Large numbers of self-employed people like mechanics, technicians, driver, plumber, with little financial literacy have poor credit history. They can finance their dream home with ‘Swaraj Home Loans’.

Click here to check the home loan eligibility

Still, if you receive the home loan at low credit score, you will love to scale up your CIBIL Score. Another way to qualify for a home loan is availing a joint home loan. Let us elucidate a case study in this regard–

Mr. Rajeev Verma, an industrial worker in Kanpur faced severe home loan rejections as his CIBIL Score was below 650. On the suggestion of a home loan expert, he applied with his working wife and as a result, his home loan application became accepted hassle-free.

All prominent home loan schemes like ‘Swaraj home Loans’ and ‘Credit Linked Subsidy Scheme of Pradhan Mantri Awas Yojana’ permit joint home loan option. The discussion would not be complete if we will not throw some light on the ways to improve the desired CIBIL Score.

1. A payment history can help you – Yes, keep paying the installments on time. To validate your claim, you can also showcase the past payment records to a credit agency.
2. No payment defaults – There should be no defaults in payments for a running loan. Payment history and defaults make a significant impact on the credit score.
3. Appeal for inaccurate things – When you track any discrepancy or error in the CIBIl report, appeal the inaccuracy on the CIBIL website. As per the rules, the lender rectifies the mistake within 30 days of timeframe.
4. Never apply for so many loans – Once you made inquiry for too many loans, it shows you are desperate for home loans and this can affect the CIBIl score negatively.
5. Seek Expert advice – Even after constant attempts, if you are not able to establish the credit, seek any home loans expert advice for the right solution.

So, we can conclude home loan is possible at low credit score with progressive home loan schemes. However, it is always better to keep your CIBIL Score high for maintaining a sound financial portfolio. Some significant steps, discussed above can bring a meaningful change in your credit score in 1 year.

{Source: https://www.iifl.com/blogs/can-i-qualify-for-a-home-loan-at-low-credit-score}

Schematic of the Home Loan Disbursement Process.

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Women and Money

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Step By Step Process For Home Loan

Best Home Loan at attractive interest rates from HDFC Home loans. Best house loan interest rates for women and salaried individuals. Avail home loans at low processing fees.