If you are looking to purchase a new home, you may invariably look and compare different properties and choose the one that best suits your needs and budget. Similarly, when you avail of a home loan to get the funds for buying your dream home, you must ensure that you get the best loan deal.
The loan you choose will become your financial obligation for a long time, i.e., till you repay the full amount. So, it is vital that you read through the terms and conditions of the loan to ensure that it is right for you.
If you are a first-time loan applicant, the whole process may seem overwhelming. The following tips can help you get the best home loan in India.
Arrange funds for down payment
Getting a home loan is a big financial commitment and you must plan your finances prudently so that you can repay the EMIs on time till the end of loan term without compromising on your other long-term goals. However, before you start the loan process, you must arrange enough funds to pay the down payment.
When you apply for a home loan, the lenders only approve a maximum of 80% of the property’s value as loan. You must pay the balance amount from your pocket. This is called down payment. If you can pay more than the minimum amount as a down payment, you can get a better deal on the home loan interest rate.
Check/improve your credit score
Credit score is a three-digit number ranging from 300-900 that reflects your creditworthiness. The various credit bureaus in the country decide your score based on your credit behaviour. Generally, the lenders consider the credit score as one of the critical factors to determine the eligibility.
So, check your credit score before applying for the loan and see it meet the lender’s minimum score requirement. If not, focus on improving your credit score. Having a high credit score of 800 or more can help you in a good position to negotiate a better deal with the lender and get a discount on the home loan interest rate.
Use the EMI calculator
Whether you are looking for a home loan in Jaipur or any other location, you must use the EMI calculator. It is an excellent tool that allows you to compute the EMI you must repay the lender based on the amount you borrow and the repayment tenure you choose. Knowing the EMI payable will help you make an informed decision on how much to borrow and choose the right tenure so that the EMI is affordable and within your budget.
Compare loan offers
One of the most efficient ways to get the best home loan is to compare the offers from different lenders. You must compare the interest rate, the charges levied, the flexibility offered in repayment, the documents needed, minimum credit score, the time taken for disbursement, processing fee, etc.
It is advisable not to choose a lender that offers the loan at the lowest interest rate, you must give importance to the lender’s reputation, credibility and the quality of services offered.
Read the terms and conditions carefully
Before you sign the loan papers, make sure that you read the T&C carefully to avoid any legal hassles in the future.
Now that you know the tips to get the right home loan, do your diligence and have a stress-free borrowing experience.