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How To Apply For Home Loan Online?

Understanding Home Loan Every person’s dream is to own a home. Most of us, though, cannot afford to buy the house outright. Taking out a home loan is one of the better ways to get your dream home. To be able to obtain the finest home loans in India, you must first comprehend the many terms related to home loans and then plan appropriately to obtain the best home loan in India through the online medium. [B-01] A home loan, sometimes referred to as a housing loan, is a sum of money borrowed from a lender to buy or build a home. Home loans can also be used to expand existing residences. There are various forms of home loans: For the buying of a residence For the purpose of constructing a residential property For the purpose of purchasing land For the purpose of home expansion Things to Consider while Applying for a Home Loan Online With the current progress in technology, Loan application processes have become completely online. The process is considered by many as much safer because there is no need to visit a physical branch. While the process remains similar, with an online application, it is important to be very careful with the documentation process to avoid delay in communication. Visit the loan provider’s website. Understand the specifics of the loan being offered, like information about the tenure, the interest rates, etc. Complete the Application Process, which includes entering the required loan amount too. Submit the necessary documents. The application will undergo verification from the lender’s side before the next step is taken. Amount of the loanThe principal amount of money you are eligible to borrow for your house is referred to as the loan amount. The amount of home loan you can get is mostly determined by your home loan eligibility, which is determined by a number of factors such as your CIBIL score, employment type, and income, among others. Piramal Finance (PCHF) only requires your documentary proof to determine your home loan eligibility. Disbursement of LoanThe quantum of house loan is considered to be disbursed when it is deposited to your bank account after your eligibility and documentation verification has been verified. Repayment of EMIsYour Equated Monthly Instalment will begin one month after you have received full loan disbursement. You must repay your house loan in equal, regular monthly instalments to repay your home loan. Loan DisbursementWhen you pay your EMIs up until the end of your loan term, you have paid off the principal as well as the interest. Home loans are typically paid off within the tenure or time for which they were obtained, however they might be foreclosed or prepaid. Prepayment fees are not charged in the case of floating interest rates, but they may be charged in the case of fixed interest rates. If you do not prepay your loan, you will be required to make timely EMI payments until your loan term expires, at which point your loan will be closed. That is, your home loan books will be closed. Do you Qualify To Apply for a Home Loan? Now that you have understood the basics of how to apply for a housing loan, it is important to check the criteria. You must be between the ages of 23 and 62 to be considered. Salaried staff must have at least two years of experience. Individuals who work for themselves must have at least three years of experience in their current area. In the case of NRIs (Non-Resident Indians), they must be salaried employees with at least three years of experience. What Documents Do I Need to Apply for a Home Loan? An applicant just needs to submit one or two items from each of the following categories: Valid passport, driver’s licence, life insurance policy, birth certificate, PAN card, and school leaving certificate are all acceptable forms of proof of age. Voter ID Card, Valid Passport, Driver License, Aadhar Card, and PAN Card are all acceptable forms of photo identification. Utility bills, bank statements, property registration documents, property tax receipts, and voter ID cards are all acceptable forms of proof of address. Existing loan information will be available through bank statements. [B-02] What is an EMI Calculator for a Home Loan? Due to the large size of most property loans, paying them in EMIs (Equated Monthly Instalments) helps to evenly distribute the loan burden. Manually calculating EMI is often complex, and as a result, people frequently get incorrect findings. An EMI calculator for a house loan is a simple online tool that rapidly calculates the Equal Monthly Instalments required to repay your home loan.
08-11-2023
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How To Apply For A Business Loan?

Do you require money to grow your business? If so, then it is time to apply for a business loan. The application process can be daunting, but not impossible. With the right information and guidance, applying for a business loan should not be difficult at all! This post will provide steps on how to apply for business loan in order to get the money your company needs. [B-01] What to know about it? Apply for a business loan from the right lender. Make sure your documents are updated and ready to go. Since you will be going through different processes, it is best if all of your paperwork with contact information, financial statements, etc., are available at all times so that they can quickly assess whether or not you qualify for a business loan online. Complete an application form that includes detailed personal data as well as company details such as incorporated status, ownership structure, and more. A bank may require additional supporting documentation from time to time in order to process their clients’ applications effectively. Be prepared! While banks typically do not ask too many questions about where the money comes from initially because most loans come directly from investors; however they always conduct thorough background checks. It is important to be transparent with the bank about your business dealings and financial situation if you need to avoid any unnecessary delays in processing time for this business loan online application. Lenders will typically provide a response within one week although some companies may take longer than that depending on their own internal processes. So make sure all conditions are acceptable beforehand. After the money has been deposited into your account, make sure to thank your lender for their support. It is essential that borrowers are aware of all terms and conditions involved since lenders may ask potential clients some critical questions about their company’s financial situation before providing an offer letter as well as different pertinent details such as interest rates, fees, repayment schedule, etc., which vary from one borrower case to another when you apply for business loan. Step by step process to apply for a business loan online: Locate the right lender for your business. There are many options online, so you should find one that fits your budget and requirements accordingly. Be prepared! Have all of your documents ready at hand to quickly process this application. After completing an application form, send off as much relevant documentation as possible such as personal data as well as company details such as incorporated status, ownership structure, financial statements, etc., so that they can assess whether or not you qualify for a business loan with them directly without having to ask further questions. Wait patiently for a response since the bank may take up to several days before providing an offer letter that outlines the terms of your agreement between both parties as well as other important details. Therefore, read it carefully beforehand to avoid any additional delays or problems with processing time! Once you sign off on everything and money gets deposited into your account after approval. It is also good practice to let them know if you need more funds in the future so they can grow even bigger than what they are right now! After receiving this information (i.e., approval), complete the necessary steps, which may include signing off on everything and waiting until money has been deposited into your bank account. Finally, it is essential to be transparent with the lender about your company’s business dealings and financial situation if you are open to receiving additional funds in the future to help them grow even bigger than what they currently are! [B-02] Marketing Tip: Keep a close eye out for any potential scams when looking online. Not every lending agency will offer competitive rates or provide good customer service, so you should always do some research beforehand before making this decision. You can also ask around among friends, family members, or co-workers who have recently applied for loans through their chosen lenders whether or not they were satisfied with how things turned out afterward.
08-11-2023
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How To Get Working Capital Loan In India?

Working capital is an important dimension of any business, whether it is a start-up or medium sized venture or an established organisation. It refers to the amount that any business entity has at its disposal at all points in time to cater to short term expenses and can be calculated as the difference between the current assets and liabilities that it has. For small and medium-sized companies, having continuous cash flow that can be used as working capital is a difficult proposition due to the less amount invested and uncertain profitability. This is where having business financing facilities can help tide over temporary financial issues without having to burn a hole in your pocket. Read on to know more about how you can get working capital loans or small business loans or sme loans, from PCHF to mitigate the burden of sudden business expenses. [B-01] Know the Different Types The first thing to know before you take the decision of opting for capital loans is the various types of business financing options that are available at your disposal. They are: Trade Credit- This type of financing takes place between two traders wherein one purchases goods but the payment is made later. Bank Overdraft- In this type, financial institutions extend short term credit to the account, the moment the balance becomes zero and enable the account holder to withdraw money despite insufficient balance. The amount then is paid later. Account Receivables- If you have amounts not paid by your customers in exchange of services or goods provided, the bills of the due amounts can be sold to financial institutions at discounted rates. The latter then provides immediate cash in lieu of the same which can be obtained from the debtor when the bill matures. Short Term Loans- For meeting emergency situations, short term SME loans can be taken for a tenure of 1 year. These loans have a quick approval and disbursal process with minimum documentation work. Types of Businesses Eligible for Working Capital loans If your business entity is any of the following types, you can opt for a working capital finance without much hassle. Sole Proprietorship Limited Liability Partnerships Private Limited Companies Apart from these certain criteria like a decent annual turnover and number of years that your company has been running the business are also considered by financial institutions. The type of trade you are running also determines your requirements and the ease with which you will get the loans. Documents Required for Small Business Loan The documents required for applying for small business loans are: Standard KYC documents that include name, address, identity, age proofs Certificates of business incorporation, including registration documents, goods and services tax Last six months bank statement of the Business Current account Current year’s IT returns Outstanding debts and its details, if any Purchase orders indicating the type of goods ordered and the total capital required for the same Where to Apply for Working Capital Loan There is no dearth of sources from where working capital can be obtained. Bank Aggregators- If you do not have time to spare to look for your business loan sourcing, you can try out the Online Bank aggregators or financial institutions who offer loans for working capital at affordable rates of interest. The application process is also quite easy and approval comes fast if you have all the documents in place. Banking Institutions:- Many banks such as Punjab National Bank, State Bank of India, Indusind Bank offer small business loans at competitive rates. It becomes more advantageous if you have an account with any of the banks offering such loans. Online Lenders- If you are looking for quick cash, these online lending platforms can be just the right ones for you. You can download their apps on your phones and look out for offers on interest rates that come from time to time. [B-02] Conclusion Negative working capital is the watchword for dwindling business. To avoid such situations from cropping up, it is best to go for business loans from such reputable financial institutions as PCHF and let your business reach its zenith of success. Working capital loans are extremely popular in India, especially among small and medium sized business companies. Obtaining a capital loan is also not a tedious process if you have all the required documents handy. Banking institutions and financial institutions provide such loans with easy approval processes, both with short-term as well as long-term tenures
08-11-2023
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Home Loans vs Construction Loans: What’s the Difference?

Banks and financial institutions offer different types of home loans. Depending on the purpose behind the need for capital, the type of loan is determined. For instance, if you would like to purchase a home, a home loan would be recommended. In case you would like to construct your home on a piece of land that you have purchased, it is best to opt for a home construction loan In this article, we will dive deep into home loans and home construction loans. We will also understand the difference between them with a home loan comparison. [B-01] What Is a Home Loan? A home loan is essentially an agreement that is made between you and the lender to borrow a certain amount of money to purchase a home. You agree to repay the loan along with interest over a certain period of time that is agreed upon by both you and the lender. You can either opt for a fixed-rate mortgage or an adjustable-rate mortgage depending on what is offered by the lender. With a home loan, you also have the advantage of tax benefits under Section 80C of the Income Tax Act on your principal component. You can also leverage tax benefits on your interest under Section 24(b) of the Income Tax Act. What Is a Home Construction Loan? When it comes to a home construction loan, the lender offers to pay for the cost of constructing a new home through a home construction loan. You could either construct your home on a new piece of land or construct a part of your home within your existing property. This home construction loan will be offered at a certain interest rate for a particular period of time. You can choose the tenure of your construction loan depending on your financial repayment capacity. Your loan is secured as there is a mortgage on the property. There are many different types of construction loans such as the following: Construction-to-Permanent Loan: These loans are also referred to as single-close loans. They provide the funds that are required to build your permanent mortgage as well as your dwelling mortgage. Construction-Only Loan: With this loan, you can get the necessary funds to complete building your home. Renovation Loan: If you are planning to upgrade your existing home, you can avail of a renovation loan. Owner-Builder Construction Loan: This loan is a construction-only or a construction-to-permanent loan where the bank also acts in the capacity of the home builder. Home construction loans, as well, have tax benefits similar to home loans. Under Section 80C and 24(b) of the Income Tax Act, you can avail of benefits on your principal and your interest respectively. Difference Between Home Loans and Home Construction Loans When it comes to home loan vs construction loan, there are a few key parameters that vary. Let us have a look at the main differences between home loan and construction loan. 1. Term of the Loan: Construction loans are usually short term loans compared to home loans. The tenure offered for most construction loans is about one year or less. 2. Interest Rate: Most banks and lending institutions offer a similar rate of interest for both home loans and construction loans. However, since there is more risk involved with construction loans, some banks may charge a higher interest rate. 3. Disbursement: With construction loans, the loan amount is disbursed in phases as progress is made on the project. The lender keeps a close eye on the progress of the construction in contrast to home loans. 4. Down Payments: For a home loan, a very low down payment would be required. However, large down payments would be required for construction loans. [B-02] In a Nutshell Home loans and construction loans are availed for different purposes. There are a few key differences between home loans and construction loans such as the interest rate, down payments, disbursement, and tenure. If you are looking for a home loan or a construction loan, Piramal Finance can be your best choice.
08-11-2023
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How Working Capital Loan Can Boost Your Business?

Working capital is an integral part of running a business, whether big or small. Maintaining a positive balance, which is lesser liabilities compared to current assets, is what a healthy business aims at. Failing to maintain the balance may lead to deficits that, if accumulated, may become hard to pay back. To avoid such circumstances a working capital loan from PCHF can be the best solution. Look at how working capital can help boost your business. [B-01] Continuous Cash Flow Businesses, whether established or start-ups require a continuous cash flow to cater to the basic requirements of business such as salaries of employees, rent, inventory, mortgage payments and others. Opting for capital financing, ensures that your organisation has a continuous cash flow to meet the above demands and thus help it sustain even in times of lows. Support During exigencies At some point in time, you may face emergencies, which may not be under control. Natural calamities, accidental disasters, economic slumps and recessions may affect your business. It is important to stock up your inventory to meet the demands of your consumers during such critical junctures. Taking resort to a small amount of working capital loan can help you keep your business running seamlessly without having to shell out in bulk to purchase the additional stuff. Meeting Customer Needs Making promises that you fail to keep just because you do not have your customers’ favourite items in stock can have a negative impact on your business. Why let that happen when you can prioritise and hoard the popular inventory beforehand to meet customer demands throughout the year? Capital loan helps you maintain the high quality of your products, while meeting the seasonal expenses by keeping a stock of inventory during peak seasons. Clearing Debts Running a business is not an easy task and accumulating on debts makes it harder to pay off. Opting for a working capital loan can help pay off your dues smoothly without having to incur huge expenses and falling into a debt trap. You can pay off the loan in easy monthly instalments. Carrying out Marketing Campaigns The online cosmos has turned out to be a shoppers’ hub and if you want to boost the sales of your business, the best way to go about it is to spread the word through online marketing campaigns. It will not cost you a bomb, and you can easily obtain the amount from your business loans. Boost Creditworthiness The way you prudently and efficiently manage your working capital is a sign of your creditworthiness. Investors and prospective customers take into consideration good creditworthiness as a sign of effective business operations and robust financial health. This can also lead to lower interest rates at higher amounts of finance. Helps mitigate Unexpected Expenses and Financial Crunches Business comes with unexpected expenses for which you may not be prepared. Sudden fixes of equipment, purchasing machinery or inventory, hiring professionals for specific work may well be managed with business loans that give a capital flow without making you feel broke. Even during periods when you are going through a financial crunch, especially with the economy undergoing a downfall amidst the pandemic, taking resort to working capital loan can be the ideal bet. With Capital financing from PCHF, you can get a fast and steady flow of capital at nominal interest rates and focus on growing your business to its optimum potential. [B-02] Summary Businesses are bound to go through difficulties. However, it is not wise to quit your dream. For a business to run smoothly at all points in time, it is essential to have constant cash flow to cater to the basic requirements. This is where working capital loans come in handy. Quick, easy and convenient to obtain, capital loans from reputed companies like PCHF can help tide over uncalled for expenses, while aiding in business expansion without much hassle.
08-11-2023
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What Is Home Loan Balance Transfer

Have you ever considered switching out your home loan provider for a different one? Perhaps you noticed a lower rate of interest advertised, or maybe the coverage offered fits your preferences better. It is the protocol to research the best home loan options when buying a policy, but sometimes, you might just want to change lenders since you get a better deal. This is exactly where a home loan balance transfer comes in. [B-01] What is a home loan balance transfer? A home loan balance transfer is the refinancing that happens when you switch your home loan lender. As a borrower, once you match the required eligibility to transfer your home loans, you can switch as you see fit. The most common reason behind people opting for a home loan balance transfer tends to be a more attractive rate of interest. The following scenarios detail when a home loan balance transfer is recommended: Reduce costs: It might be tempting to transfer lenders when looking solely at the chance of getting a lower interest rate. However, note that there are costs to switching out your home loan. Look at the total benefits involved and consider the overall costs of switching your home loan. When benefits are higher than the costs, you should consider switching your loan policy. When you are far from approaching the end of your policy tenor: If your policy is reaching the end of its tenor relatively quickly, such as within a matter of months, it would be unwise to switch lenders. In case your home loan is in its initial few stages, a balance transfer is considered advisable. When the unpaid home loan amount is high: Is the majority of your loan amount still unpaid? In this scenario, opting for a lender at a lowered rate of interest is probably advisable. This implies that you will get to pay the remainder of your loan at a more attractive rate of interest. What are the benefits of a home loan transfer? A home loan transfer comes with a host of benefits. Lower ROI: The most obvious and attractive benefit is the fact that the interest rate is lowered. This is also the primary reason why borrowers opt for a home loan transfer. A lower rate of interest can reduce the EMI as well as the eventual cost of the loan. Longer tenor or reduced EMIs: Another key reason why borrowers opt for a home loan balance transfer is the lowered rate of interest offered by a different lender. Lower interest rates reduce the EMIs, and eventually the overall loan cost. Top-up option: Sometimes you might need extra funds to cover a large project such as a home renovation. If your current home loan amount doesn’t suffice, a loan transfer could enable you to receive a top-up facility. Other benefits: You might find that your new lender offers more benefits which prompted you to switch. These benefits could be more flexibility and affordability. [B-02] The Bottom Line A home loan transfer is considered a good decision in circumstances where you wish to reduce your EMI costs, get a lowered rate of interest, and generally save money on your loan repayment. You can even consider the highly flexible home loans options available on Piramal Finance. You get hassle-free processing, and simple repayment terms for loans that serve your needs.
08-11-2023
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All About Top-Up Loan

Making your financial dreams come true can sometimes require a helping hand. Whether you're renovating your home, starting a business, planning a lavish wedding, or pursuing any other lofty goal, having the requisite funding is essential. When it comes to loans taken for housing purposes, your long-term goals can change. Perhaps you took out your loan five years ago and now wish to renovate your house. What should you do if the loan amount doesn’t suffice? This is where a top-up loan comes in. What is a top-up loan? A top-up loan is an additional help on top of a pre-existing loan provided by banks and financial institutions, which can help you fulfill your goals through extra financial aid. Specifically, a top-up loan works by being added over and above your home loan amount. Similarly to how you top-up your mobile balance when you run low, banks offer a top-up facility over your current balance. Most lenders offer a top-up facility. If your lender does not allow you to top-up your home loan, you can transfer to a lender offering this facility. Let’s understand how a top-up facility will work well using the aforementioned example of home renovation. Let’s say you took out a home loan of ₹50 lakhs payable over a ten-year period. Five years into your loan repayment, assume your outstanding principal on this home loan is ₹28 lakhs. However, this amount might not be enough if considering a major home renovation. You have multiple options. You could purchase a fresh personal loan to finance your renovation or opt for a top-up facility. In most cases, the top-up facility would be the cheaper option. Features of top-up loans: Top-up loans have the following characteristics. Use the following pointers to determine whether they are worth considering. Eligibility criteria: Similar to how a loan has to be approved by one’s lender, a top-up loan is not available to everyone who has availed of a home loan from a bank. Several factors are looked into by one’s lender before they decide to grant a top-up loan. For instance, the borrower’s ability to repay in timely installments is assessed by their credit score. This can be seen through the repayment of the previous home loan. If the borrower’s credit report is favorable, the bank will grant them the top-up loan. Processing fees: Usually, opting for a top-up loan isn’t free. Processing fees are applied to the top-up facility. Sometimes, the financial institution might be open to waiving the fee. Check with your lender beforehand about any processing fees for the top-up loan. Tenor: A top-up loan is usually given for the remainder of the pre-existing loan’s outstanding period. If your home loan policy has a remaining four-year tenor of 4 years, the top-up facility must be repaid within this tenor. However, the tenor can be different across lenders. Rate of Interest: The interest rate applied to your top-up loan facility will likely be slightly higher than the rate applied to your pre-existing home loan policy. However, the top-up loan interest rate is more attractive compared to the high interest rates applied on personal loans. Purpose: A top-up loan can be utilized to construct or modify your house. You can also use it to cover personal expenses, like funding a child’s education. However, note that you cannot utilize a top-up loan for any speculative purposes. [B-02] Conclusion A top-up loan can be exactly what you need to fund your home’s renovation. It is added over and above your pre-existing home loan policy and can be cheaper than taking on a separate personal loan.
08-11-2023
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Difference Between Home Loan And Loan Against Property

Easy accessibility of loans and a wide range of home loan products have made life easier for the borrower. But sometimes the variety of options can make it a bit tough to decide which loan to go for when you are planning to apply for a loan. A case in point is when deciding between a loan against property and a home loan. Most people confuse these two different types of loans and use their names interchangeably. Apart from the fact that both of these loans are secured in nature. Both, a home loan and a loan against property are different when it comes to their usage, interest rates, tenor, LTV ratio, and processing fees. [B-01] What is a Home Loan? A home loan is the amount of money borrowed by an individual from a lender such as banks or NBFCs to purchase a house. The loan amount and interest are repaid to the lender in form of EMIs over a period depending upon the tenure of the loan. The type of property for which a loan is taken could be a ready-to-move-in house or a vacant plot of land or an under-construction property. A home loan can be taken for both, personal and commercial property. It is a secured loan because the lender takes the property as security for a home loan. In case of default in repayment of the home loan, the lender can take possession of the property and sell it off to cover losses. What is a Loan Against Property? A loan against property is a secured loan taken against your residential or commercial property. A loan against property is preferred by many borrowers because it provides a high loan amount at low interest rates as compared to personal loans. If you have a property in your name and can provide documentation that establishes your ownership then you are eligible for a loan against the property. It can aid in fulfilling a variety of your financial requirements and has become a go-to option in recent times for most people. Home Loan vs Loan Against Property Listed below are some key factors which highlight the difference between a home loan and a loan against property. UsageOne of the major differences between a home loan and a loan against property is the usage of a loan. A home loan is used to purchase a commercial or residential property such as a ready-to-move-in apartment, property under construction, or a plot of land on which the borrower intends to build his/her home. A loan against property is more versatile in nature and can be used for buying a property or meeting fund requirements arising because of personal reasons such as growing your business, a medical emergency in the family, or funding your child’s education, etc. Interest rateA home loan interest rate is slightly lesser as compared to the interest rate offered for the loan against property. One reason could be the effect of the government of India’s Pradhan Mantri Awas Yojana initiative which aims to make housing affordable for all. Another reason for this difference in interest rate is that the chances of defaulting on a mortgage loan are higher in comparison to a home loan. LTV ratioLTV ratio or the Loan-to-value ratio is a risk assessment methodology a lender employs to understand the lending risk. Higher the loan assessment LTV ratio, the higher the risk associated with that loan which can lead to higher interest rates levied by the lender. For a home loan, the loan amount sanctioned can go as high as 90% of the property’s market value. In the case of a loan against property, after the lender’s evaluation, the maximum amount sanctioned can go as high as 60% of the property’s market value. Tax BenefitsUnless used to buy another property there are no tax exemptions that can be availed on a loan against property. On the other hand, various tax exemptions can be availed on a home loan under Section 80C and Section24. [B-02] Bottom Line Even though a home loan and loan against property may sound similar to new borrowers, they differ in the purpose they serve. A home loan is what you need if you are thinking of buying a property be it commercial or personal. But if you are planning to take a loan for fund requirements that go beyond purchasing a house, a loan against property would be a good option.
08-11-2023
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Tips & Advice

Should You Consider Getting Home Loan

A home of our own is one of the major life milestones for most of us and has often been regarded as a measure of success in life. It is perhaps one of the biggest ambitions of the Indian middle class. Ever rising inflation and soaring property prices made it a distant dream for a long time. But the recent dip in interest rates, affordable housing loan options, and hassle-free loan processing has once again ensured this dream remains within the reach of a common man.Whenever you plan to buy your own home, the first question that comes up in a dinner table conversation is whether you should consider getting a home loan. A home loan for beginners can be a tough question to answer. Though it may seem easy at first, getting a loan approval can be a laborious task. [B-01] Here are a few key factors that you need to keep in mind before you sign on that dotted line. Eligibility Criteria Irrespective of the type of loan you are applying for, it is wise to consider and understand the eligibility criteria of the financial institution from which you wish to get the loan sanctioned. The eligibility criteria and chances of loan approval are dependent on various factors such as the monthly income of the borrower, the number of dependent members in the family, existing liabilities, if any, and whether you are a salaried or a self-employed individual. A salaried employee with a stable income, no liabilities, and a lesser number of dependants would have higher chances of loan approval as compared to a self-employed borrower with inconsistent income and multiple dependants. It is prudent to keep the above points in mind while applying for a housing loan. Credit Score Whenever you apply for a loan with a bank or any financial institution, the first thing that a lender checks is the borrower’s credit score. A credit score is a good indicator of a borrower’s repayment capability and a high credit score usually means a lower interest rate. The creditworthiness of an individual is directly proportional to his/her credit score, it contains the track record of an individual’s repayment of existing loans or bills and dues. A good credit score usually aids in getting approval for the loans and also improves the chances of getting a lower interest rate. Loan Tenure Loan tenure usually varies based on the profile of the borrower and the amount of home loan sanctioned. Loan tenure for a housing loan is a period for which the lender has sanctioned the home loan amount and the borrower is responsible to repay the amount along with the interest. The majority of banks or financial institutions provide loan tenure up to 30 years depending upon several factors such as the age, financial history, and financial obligations of the borrower. A longer home loan tenure usually means that the EMIs are spread out and hence the monthly installment amount is lesser but on the other hand a shorter loan tenure would mean a lesser amount of interest paid to the lender. So while considering the home loan duration, it is advisable to keep in mind the EMIs affordability which ideally should be less than 50 percent of an individual’s monthly income. Home Loan Amount While a home loan amount eligibility is dependent on several factors, it is advisable to keep the cost of the house within 5 times your annual income. This helps in keeping the EMI repayment easier without affecting your monthly household budget. [B-02] Bottom Line At the end of the day, owning a home is a dream of many. In the current low-interest regime, a home loan has become much more accessible and affordable. But before you take a plunge in these waters, it is imperative to be aware of how a home loan works to avoid any surprises at later stages.
08-11-2023
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