We are sure
you’ll agree that buying your own house is one of the greatest achievements in
life. Thanks to the continuous efforts of government and private finance
companies who have reduced the rate of interest as low as 8.50 to 9.50% to
avail a home loan and has
fulfilled the dreams of millions across the nation.
Under the
PMAY-Credit linked subsidy schemes the rates have further dropped down to
around 6.50% to 7% which makes home loans a viable product for many middle-class
applicants in the society.
However,
when it comes to sanctioning the home loans banks and non-banking finance
companies (NBFCs) are quite strict towards having a background verification of
borrowers. They give check various qualify
parameters such as income source, age, property location, job or business
stability, nature of work, credit history, etc. and then suggest a suitable
loan amount.
Of these,
the most helpful and promising one is the joint income source. Many times an individual
might be looking for higher loan amount but due to a low-income source, he or
she is unable to get higher loan limits. At such point of time, adding an
income from your parents or spouse can help you get higher eligibility and
fulfill your dream.
Joint income source assures a stable source of
money towards your monthly installments for the bankers and non-banking finance
companies. With a joint income source
and good credit history you can negotiate for low-interest rates, and waiver of
processing fees.
Apart from joint income source few
other parameters that need to be addressed carefully before applying for home
loans are as follows:
Existing Debt: Any existing debt you hold will bound
to affect your credit score. It means you’ll get low loan amount against the
required financial needs. Banks and firms consider your debt to income ratio
when you apply for a housing loan so
you need to make sure you clear off as many debts as possible in order to favor
your housing loan lenders.
Savings: Ideally, the lender agrees to offer
finance up to 80% of the agreement value of the home. Every bank or non-banking
finance company will have its own eligibility criteria under which you need to
show the margin money of 10-15% handy before you apply for home loans.
So, it is
advisable to save at least 20% of the down payment and have little extra to
cover few monthly installment on your loan.
Problems like a recession, health issues or other perils might grapple
you anytime with no source of income for a while so it's better to be prepared
to cover your expenses for a couple of months. This shows your well
preparedness towards your housing finance.
Employment history: When a person is working in
particular firm or job for more than 2 years it shows better stability for your
income source and lenders will be willing to have quick loan sanction.
In case
you’re applying for a loan then don’t consider to quite, change your job.
Instead, hold on your horses until your loan gets approved. Alternatively, if it’s a business then they
will check your IT- papers and other required documents to prove its stability.
In India,
there are various types of customized home loans to choose from. Always
choosing the first one is not an intelligent option. Instead, there are online
sites that will help you compare the interest rates, pre & post penalty
charges, EMI delay charges, interest rates and flexible repayment options. So,
visit online and compare your loan. Also, you need to know how much you can
afford it.
It would be
best, to check online through housing
loan eligibility calculators
what amount you get pre-qualified for a loan. It helps you understand how much
you can afford a home and about the mortgage payments would come up to. With
internet-based services, time is spinning across compared to an age-old process
of visiting banks, filling up forms, getting copies attested and submitting
them. With online service, you can fill the relevant form, attach a scanned
copy of relevant documents and submit the same online for approvals.
Expense-to-income Ratio: The expenses of the borrower should
not shoot up higher than 50% of his or her income. Else it’s become difficult
to avail a loan. Lender's assessed’ borrower’s repayment capacity with factors
like income, asset, liabilities and job stability.
Credit Score: It plays a crucial rule in measuring
the borrower’s creditworthiness. It builds a trust factor in lenders that
you’re a regular payer and pays all your dues’ on time. A lending firm may not
consider an applicant whose credit score is below 750.
It’s simple the closer you get to the loan
eligibility parameters, better are the chances of availing higher loan limits.
Visit online, compare and apply for home loans, now!
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