Your Guide to the Best Housing Loan Lenders!
Buying a home is everyone’s dream. However, buying a house requires a considerable sum of money that you might not have readily available. This is where home loans come into the picture.
Home loans are financing solutions that allow you to buy your dream home. Home loans give you the funds needed to buy a property (ready-to-move-in or under construction) or a plot of land. You have to repay the amount in EMIs over the chosen tenure.
Both banks and Non-Banking Financial Companies (NBFCs) offer different home loans to choose from. Which, among them, are the best? Read on to know more.
Choosing the best home loan lenders
There are different parameters on which you can compare the different home loan lenders to find the best. These parameters are as follows –
- Loan quantum
Loan quantum means the maximum amount of loan that the lender is willing to give. This quantum depends on your eligibility qualifications. So, check which lender is offering how much based on your eligibility.
Moreover, lenders have a Loan To Value (LTV) ratio up to which the cost of the property is financed. For instance, if the LTV is 80%, the lender will finance up to 80% of the property’s cost. You should bear the remaining as a down payment.
So, check the LTV across lenders. Choose a lender offering the remaining funding depending on the down payment you want to pay.
For instance, if you can pay only 15% of the property’s cost as a down payment, look for a lender offering an LTV of up to 85%.
- Interest rate
The interest rate is one of the most essential comparison parameters. The lower the rate, the more you can save on the interest outgo. So, the best lender will be the one with the lowest interest rate on loan.
- Other fees and charges
Also, check the other fees associated with the home loan. These charges also demand additional payment. As such, the lower the charges, the better.
- Loan process
Lastly, check the loan process – the easier, the better. An easy loan application and sanction process reduces hassles and allows you to buy the home without stress.
Tips for borrowers
When selecting home loan lenders, here are some tips that might help –
- Check out the home loan offer from your existing bank. Banks with whom you have an existing relationship might offer attractive interest rates on loans. Moreover, the application process also gets easier.
- Use the home loan EMI calculator to find the prospective EMI of the loan. Lenders with the lowest EMI should be preferred.
- You can reduce the interest rate if you have a high credit score. So, maintain your credit score for lower rates.
What is a home loan balance transfer?
A home loan balance transfer is a process in which you can transfer the outstanding balance of an existing home loan to another lender. For instance, say you availed of a home loan from Lender A for 30 years. After 5 years, you choose to transfer the loan to Lender B. In this case, the loan’s outstanding balance will be transferred from Lender A to Lender B. This is called a home loan balance transfer.
Borrowers usually opt for a home loan balance transfer to enjoy lower interest rates with another lender.
What is a joint home loan?
A joint home loan has two or more applicants. The applicants apply for the same loan together and take the liability of loan repayment.
Can I avail of multiple home loans from different lenders?
Yes, you can avail of multiple home loans from different lenders. However, mention the existing loans to another lender when applying for a new loan. The approval from the other lender solely depends upon your eligibility and the lender’s decision.
Do home loan lenders allow online loan applications?
Yes, many lenders allow you to apply for a home loan online. You can apply online and get in-principle approval on loan. However to complete the paperwork and other home loan-related formalities you will have to visit the branch.