Purchasing or constructing a house is a big financial decision. A home loan can make the process simpler. It can give you up to 90% of the property price as a loan. You can also get tax benefit
s for paying the EMIs on time.
This article contains the most important tips you need as a first time home buyer.
The Top Things to Consider as a First Time Home Buyer
Choosing the Right House
Depending on your budget, you can choose to buy a big mansion in the heart of a capital city or a humble studio apartment in an upscale residential society. Alternatively, you may construct the house of your dream on freehold land, while ensuring that the place has all modern amenities and an improved transport network. Whatever you want, it is better to evaluate your needs and select the best property which fits your financial objectives.
Finalise the Amount You Need to Shell Out
Home purchase or construction is a significant investment. In most cases, home buyers cannot fund the purchase out of their savings, prompting the need to apply for a home loan. When you approach a lender, they evaluate your documents and calculate your eligibility before informing the home loan amount and interest. Look around for several lenders and choose the lender with the best terms.
Scour for the Lowest Interest Rates
First things first, the lower the home loan interest rates, the lesser the home loan EMIs. Home loan interest rates depend on various factors, such as income, credit score, loan amount, borrower’s age, etc. For example, if your credit score is above 800 and the loan amount is less than INR 35 lakh, you can expect the interest rates to start from 7.35% per annum. Conversely, if your credit score is less than 100 and the loan amount is greater than INR 35 lakh, the rates may start from 8.80%. Hence, if you want to get the best home loan interestrates, you should improve your credit score.
Check Your Eligibility
Lenders look at a wide range of information to determine your eligibility and offer you the best rates. Some such factors are age, location of the property, credit score, stability of income, nature of the income, and so on. Generally, you must be a citizen of India, and your age should be between 21 and 65. The location of the property is an equally important parameter and depends on the property’s resale value. For instance, if your property is in a prime location with all modern amenities, you can apply for the highest loan amount. Hence, before applying for the home loan, you must check your eligibility and negotiate with the lender.
Select the Loan Term Carefully
The term or tenure of a home loandecides how long you have to remain under the burden of debt. Generally, lenders offer up to thirty years for repayment. However, an extended term also comes with higher home loan interest rates. Hence, it is better to opt for a shorter term if you want to close the loan faster and become eligible to apply for a new loan.
As a first time home buyer, you will need to keep several things in your mind. Thankfully, a home loan from a reputed lender like PNB Housing can take away the stress of arranging money. PNB Housing offers attractive home loan interestrates and doorstep service delivery for faster loan approval. With interest rates at their multi-year lows, this is the best time to fulfil your dream of owning a house.