What type of loan should you get for a home?
A house is one of the heaviest financial transaction for many people and it goes beyond selecting the right property. It is about affording this transaction with little to zero impact on other expenses. This is vastly essential to enjoy a stress-free life with no worries about managing other expenses. Having your own home is a way for you to meet several needs, fulfill your wishes, and enjoy a life full of security and contentment. However, with the growing real estate costs and present scenario, it has become difficult for people to fulfill this dream without it letting other expenses vastly.
And hence, home loans have emerged and are Helping masses of the country to fulfill their dream of purchasing a house without making a massive one-time payment.
Basically, home loans are a specific amount of money that an individual borrows from a particular NBFC or bank at an interest rate that is decided before-hand and has to be repaid by the borrower with an EMI every month. The property is kept as a kind of security by the financial company. If the borrower fails to repay the dues, the financial company has all the legal rights to recover the amount by the sales of that property. Home loans in India have grown vastly popular in recent times.
Before starting to apply for a home loan, you have to determine the total eligibility which depends on your repayment capacity, the stability of income, age, liabilities, assets, and other things.
There are a few things to keep in mind when considering home loans:
A great feature of home loans is the long repayment tenure that a borrower can benefit from which goes up to 30 years. It provides borrowers with the opportunity to reduce their equated monthly installments by extending their period of tenure. This is vastly helpful as it ensures that the borrower is not too overwhelmed by the very high EMI and can also manage their ongoing expenses smoothly!
Today, the Government of India is providing tax deductions on the principal amount as well as the interest rate. This has been initiated to encourage the maximum number of people to purchase their dream house. Under section 80C of the Income Tax India Act, the borrower can now claim a tax deduction of Rs. 1.5 lakh in a single financial year.