Everything you need to know about home loans in India

Taking home loans in India does not seem an easy job because all the key information and knowledge is never available in one place. Well, today is your lucky day. In the article below you will get to read and understand almost everything that is there to know about buying a home. So, sit back and learn everything home loans.

Amount of loan

Home loans in India are given for up to 85 percent of the house value. This means if your dream home is going to cost you Rs. 1 crore, your home loan provider will give you up to Rs 85 lakh. Depending on your home loan eligibility, the bank gives you the ideal money that best suits your situation.

Loan eligibility factors

There are various factors that are taken into account to decide whether you are creditworthy. Banks look at education, income, existing liabilities, current savings, credit rating, and repayment capacity. All this is based on your specific data.

Loan tenure

Buying a home is a big decision. While the loan money is given to the seller in one shot or in a few tranches, the tenure of a home loan can stretch up to 30 years or 360 months. All you need to do is dutifully pay the equated monthly instalment or EMI for the tenure period.

Types of interest rates

You can be buying a home by using either of the two available interest rate models. The first one is fixed interest rates, which strive to keep the rate the same. The second one is a floating interest rate, which aims to give the option of paying market rates depending on the prevalent interest rate scenario.

Types of home loan

Your needs for a home loan can be varied. Good banks like IDFC FIRST Bank understand these unique needs. That is why home loans in India come in different shapes. There is a home purchase loan, a home improvement loan, a home loan balance transfer, a land purchase loan and an NRI home loan.

Tax benefits

Buying a home is a dream come true for everybody. When you use home loans in India, it comes with multiple tax benefits that significantly drop your tax outgo. There is a deduction for interest paid on home loans, deduction in respect of interest paid towards home loan during pre-construction period, deduction on principal repayment, the deduction for stamp duty and registration charges, the deduction for first time home buyers and deduction for joint home loans in India.

Home loan insurance

Most financial institutions selling home loans in India will advise you to take a home loan insurance. The insurance acts as a cover if something untoward happens to you. Then, the insurance policy will pay the EMIs, or repay the entire loan.

Now that you are well informed about home loans, choose a dependable financial lender like IDFC FIRST Bank to secure your dream home.