Property is an appreciating asset in India. Demographics also play a vital role in case of real estate prices. The average price of apartments in Bangalore is almost Rs. 82,000 per square feet. In Ahmedabad, the average plot price is about Rs. 57,000 per square feet.
With the rising prices of houses and apartments, substantial savings for a residential purchase is unheard of. Even if someone can afford to purchase a home with in-hand funds, it is unlikely that the individual hails from the middle-class or lower financial background. Home loans are the best solution to acquire a residence and settle down.
Type of Home Loans
A wide variety of home loans available in India makes it easy for a person to buy a house. You can choose a plan that fits your individual needs and repayment capacity. Let’s look at the most important types of home loans available in the country.
Loan for House Purchase
You are eligible for this loan when buying a residential property from a previous owner. Lenders can disburse up to 85% of the property’s worth. These loans are offered with either fixed or floating interest rates. Know how to choose between floating and fixed interest rates and apply for the loan accordingly.
Loan for House Construction
Home construction loans are best for those who want to build a new house as per their design objectives. Finding out everything you need to know about a home construction loan before applying is advisable here.
Loan for Land Purchase
Purchasing land comes with many different benefits. You can buy a land and construct a plot whenever your finances allow you or use the Improvement Loan property as an investment. You can avail up to 85% of the land value through a loan for land purchase.
House Improvement Loan
A home improvement loan can support expenditures required for renovation and repair. Painting, plumbing work, waterproofing, construction of underground tanks, and electrical works are part and parcel to such projects. You can easily utilise the funds from such a loan to meet these expenses.
Home Conversion Loan
When an existing home loan is transferred to another loan with different terms and conditions within the same bank, it is called a home conversion loan. With this loan, a borrower can reduce the interest rate and enjoy several other benefits.
A specialised type of home loans, these are short-term advances that allow a person to buy a new property while they wait for funds from the sale of their existing house. To utilise this loan, one needs to furnish the financial papers of their new house.
Lenders offer such options to benefit individuals across multiple situations and help them avail their residences with the necessary financial support.
Factors to Consider When Availing Home Loan
Home loan interest rates are among the first factors which borrowers consider before they opt for a lender. Although it is just as vital to keep an eye out on other features and benefits too.
Top financial institutions including NBFCs also optionally offer the facility to avail a top-up loan over the existing home loan. Several NBFCs also provide Top-Up Loans when you avail the balance transfer facility.