Loanyantra Quora Answers.

Which bank gives instant approval for home loans?

Most of the bank will give you instant sanction of Home Loan based on your Eligibility. This doesn’t mean you will compulsory that you will get a home loan for that property.

Home Loan Sanction means you are eligible for certain amount of Loan. During the sanction whey would check following things

  1. Your Salary
  2. Your age
  3. Your Existing EMI
  4. Your Credit score
  5. Your KYC

If all are in place, then banks you issue a Sanction letter. Then you can go with legality Check and technicality check of the property you have selected. If everything is clear then you would get a loan. In case any of it fails then you have sanction letter and you have 3–12 months validity based on bank. You can search for one more property and continue with the loan.

Banks also have a Pre-approved loan concept. Where in banks would issue a sanction letter and later you have certain time to finalize the property.

Advantage of Pre-Approval Loans is

  1. You get to know your Loan eligibility
  2. You reduce one step of loan before you finalize the property

Disadvantages of Pre-approval loans is :

  1. You have to pay the processing fee.
  2. It has 3–12 months validity so you have to finalize the property with in that span or else you need to submit all the documents again. Trust me selecting the first home is not so easy and not so fast unless you are lucky.
  3. Most of the case you might have to submit the KYC documents again.

I would recommend you check your eligibility on home loan comparison portals like LoanYantra | Get Home Loan Online and then you select the property. Instead of going for pre-approvals.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

 

 

 

 

 

 

 

 

What is the best home loan if I can increase EMI by 10% and can pay extra EMI per year?

If you have excessive cash then lots banks have a Over Draft Loan products. Where in you can park the excessive cash in the OD Loan account, for the amount of cash you have parked they will not be charging you interest on it. This helps in closing the loan much faster.

Let me give an example. Consider you have taken 50 lac loan. For simplicity lets consider you are paying Rs 55 ,000/- as EMI. Out of which Rs 50,000/- is going toward interest and Rs 5,000/- is going toward principle.

Say you have Rs 10 lac cash which you deposited in the OD Loan account.

Then next month your EMI will still be Rs 55,000/- the way it is distributed is

Rs 55,000 = Rs 40,000(Towards Interest) + Rs 5,000(For Principle) + Rs 10.000(Gets added to Rs 10 lac)

So your Rs 10 lac now becomes Rs 10,10,000/-

Best part is when you want your Rs 10 lac, you can withdraw it any time and you EMI will be amortized as per schedule.

List of banks which provide OD Loan facilities are

  1. SBI
    1. Max Gain Home Loans (its interest rate is 0.10% higher than normal loan)
  2. Standard Chartered
    1. Smart Saver
  3. IDBI
  4. CITI Bank

In case, you increase your EMI every year by 10% then your 20-years loan will close in 12-years. If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

 

 

 

 

 

 

 

 

 

Is it better to save money for a few years and then buy a 2 BHK home, or take a home loan and end up paying double the cost?

Debt is not bad when it comes at Home Loan Rate. Home loan is given considering you continue to earn and you are capable of paying it back. So Debt allows you to save and pay the debt.

Real Estate is little tricky. Consider you want to buy a 35 lac home now. But you have only 10 lac now. So for you to buy only option would be going for 25 lac loan or you want to save another 25 lac and delay the purchase. To save 25 lac you would take at least another 5 years. Lets say the price of the apartment appreciates very little to only 50 lac. Now you have to save another 15 lac more. Lets say you take another 2 years to save another 20 lac. Now you go and buy same apartment for 55 lac. When you saw it for the first time it was costing you only 35 lac but now its 55 lac. Also for 7 years you would have stayed in rented house and continued to pay say Rs 10,000 on average. So you would have paid Rs 8.40 lac as rent. And lets not forget the tax benefit the home loan gets you. For last 7 years lets consider you can save a tax of 2 lac.

So in total for delaying the purchase your total cost is

Rs 65.4 lac = 55 lac + 8.4 lac (Rent)+ 2 lac (Tax)

Thats almost close to what you will be paying for 20-years loan.

Unless you have a huge windfall gain or you got lot of cash because you sold property somewhere else loan is a good.

If you plan your loan well, you will be able to close it faster and home will be fully yours. Instead of paying double the cost you can pay 50% more and close it fast.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

 

 

 

 

 

 

 

 

 

 

 

Can I get a loan of 80 lakh from any bank if I come from a middle class family?

To get a home loan of 80 lac, it doesn’t depend on Status, Caste, Creed, Religion, Colour.

It depends on following factors

  1. Your Salary or Your Business turnover
  2. Your age
  3. Your Existing Loans
  4. Your Credit Score.
  5. Last but not the least the Property you are buying & Own contribution to pay 20% of the property

Your Salary : You should be earning enough to pay the 80 lac EMI.

Your Age : Based on your age, maximum Loan tenure will be decided. Before you retire i.e 58 years you should be clearing the loan.

Existing Loans : If you have any exiting Loans, you will be paying EMI so you overall eligibility would come down for the next loan.

Credit Score : Banks/NBFC would look at your credit report and based on how you have paid will decide to go if they want to give you loan

Property : When you are asking for Rs 80 lac loan, it would mean at least the property should be Rs 1 crore. Technically the price of the property should support it and you have to pay 20% from your self funding and 80% you can take loan. It should not be like for Rs 10 Lac property you are paying Rs 1 Crore.

Plan your loan well, so that you will close faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

 

 

 

 

 

 

 

 

 

 

Suppose my home loan EMI is 13,500Rs. If I don’t have enough money to pay one particular month, what is the minimum amount I need to pay toward my loan?

Yes there is a concept of minimum amount to be paid in Home Loans too. It’s called Pre-EMI.

You can visit your Bank/NBFC and request them to convert to Pre-EMI. After your financials are under control you can convert them to full EMI again.

What is Pre-EMI ?

I hope you understand what is EMI. In Pre-EMI, you only pay interest part of the EMI. You Don’t contribute towards Principle.

Let me explain what is EMI. EMI normally is a constant amount you pay to lender and EMI consist of 2 componenets

EMI = Interest amount for this month + Principle amount you want to pay

Example : If your EMI is Rs 100.

1st EMI : 100 = 90 (Interest) + 10(Towards Principle)

2nd EMI : 100 = 89(Interest) + 11(Towards Principle)

You continue to pay till interest becomes ZERO

Where as in Pre-EMI , if your Pre-EMI is Rs 90 then

1st EMI : 90 = 90 (Interest) + 0 (Towards Principle)

2nd EMI : 90 = 90 (Interest) + 0 (Towards Principle)

Till you start contributing toward principle , the interest will not come to Zero. So you will be paying for ever till you convert back to full EMI

What are the advantages ?

When you are short of money you can fall back to Pre-EMI so that your CREDIT score is healthy and your Loan doesn’t become a NPA and bank doesn’t seize the property.

What are the disadvantage ?

Biggest disadvantage is the loan tenure will not reduce. For example if you have opted for 20-years loan and then you opted for Pre-EMI and paid it for 5-years then after 5-years you still have to pay for 20-more years.

For more information and difference on Full EMI Vs Pre EMI – Get Home Loan Online In India

Plan your loan well, you will close fast and home will be fully yours.

If you already have existing home loans then to plan well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

If you are looking for Home Loans and want to plan it well to close fast then apply on LoanYantra | Get Home Loan Online

 

Taking personal loan (for down payment) and home loan for buying house, is it possible to convert/merge personal loan to my home loan later?

There is no direct way of merging your personal loan with home loan. Only one way is to take top-up loan after 6–12 months and use the top-up loan to close the personal loan.

But, the option of using top-up loan to close the personal loan is not a good option. As the tenure of personal loan is normally not more than 5 years and home loan tenure in normally more than 10-years, you end up paying more interest on top-up loan.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

-Vijayananda Reddy Kalluru
Founder and CEO of LoanYantra | Get Home Loan Online

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Is there any difference while taking a home loan from a private or nationalized bank?

The simple answer is No.

All the private & nationalized banks follow almost same procedure. So answer is no.

Complicated answer is Yes, even yes for 2 different nationalized banks too.

In broader sense all the banks follow the same procedure but when you go into internal policy and into more details of each bank & NBFC, they have there own credit risk policy which the CRO & his team(Chief Risk Officer ) would be continuously working on. Based on the credit risk policy, banks would create multiple home loan products. Also if you future go deep into the credit risk policy of some banks, some times they would limit the maximum number of loans for certain home loan product to certain number. For example : Maximum home loan for this Quarter for Full fixed home loan tenure product, should not cross Rs 100 Cr and not more than 250 files. As the risk mitigation is high.

Every bank and every loan product has advantage and its own disadvantage.

When you are selecting a bank , you nee to be clear on what you want.

  1. Faster processing of loan. With all the documents in place
  2. Faster processing of loan. With some documents in place
  3. No processing fee and other fee
  4. Want more LTV. More Loan eligibility
  5. Lesser Interest rate
  6. Need OD home Loans. Smart saver
  7. No other charges in future
  8. Need to add co-applicants like Mother, Father, Brother or even Father-in-law and others
  9. With Bad credit score with all NOC in place
  10. Less charges and overhead while processing the loans
  11. Easy to pay Part-payments and accepts any amount as part-payment
  12. Easy to foreclose the loan
  13. In future want to avail top-up loans
  14. Want interior loan with the same rate of home loan.
  15. Pre-sanction of the loan.
  16. Loan for property in the outskirts of the city.
  17. Loan for the property with deviation.

Based on above, you would have only few products and few banks which you give you hassle free loan.

I would recommend you check your eligibility on home loan comparison portals like LoanYantra | Get Home Loan Online and they would help you in choosing the right home loan.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

 

 

 

 

Which is the best bank to take home loans in Bangalore?

First check you eligibility and compare which loan product and which Bank/NBFC will suit you. LoanYantra | Get Home Loan Online is one website which will help in identifying the perfect home Loan product that would suit your financials and your property legal and technical.

In Bangloare, be cautious while buying a property. You have multiple types of approvals. Based on the approval banks give you home loan.

  1. BDA approval properties: Normally all banks & NBFC will give loans
  2. BBMP A-Khatha approved: Normally all banks & NBFC will give loans
  3. BBMP B-Khatha approvedwith construction approval plan : Few Banks & NBFC give loans.
  4. BBMP B-Khatha without construction approval plan: Very few NBFC will give loans
  5. Grama panchayat approval with construction approval plan: Very few NBFC will give loans
  6. Grama panchayat approval without construction approval plan: Almost none of the banks & NBFC will give loans
  7. Unconverted plot: Almost none of the banks & NBFC will give loans

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

-Vijayananda Reddy Kalluru
Founder and CEO of LoanYantra | Get Home Loan Online

 

 

 

 

 

 

 

 

 

 

 

 

 

 

How much EMI will I have to pay if I get a home loan of Rs 50 lakhs?

Before some one answers this question, one need to know what is your exact age & if you are salaried or a business man and last but not the least at what rate you have availed the home loan at.

Why do we need to know your age ?

Your age will determine what would be your maximum tenure eligibility. As per India, a salaried person should retire by 58-years. Which would mean your earning would ideally stop at age of 58-years. So banks would calculate your EMI based on the age. Meaning if you are 35-years then maximum tenure your would get is only for 23-years. if your age is 48 -years then your maximum tenure can be only 13-years. If you are a Central Government Employee with a pension then your based on your Job cadre you might get higher tenure.

What is the maximum age for a self employed or business man ?

Based on the nature of business, your maximum age to repay loan is upto 70 years.

You can check your EMI from http://loanyantra.com/Calculator…

Other factors of home loan will depends on following

  1. Your Salary or Your Business turnover
  2. Your age
  3. Your Existing Loans
  4. Your Credit Score.
  5. Last but not the least the Property you are buying & Own contribution to pay 20% of the property

Your Salary : You should be earning enough to pay the 80 lac EMI.

Your Age : Based on your age, maximum Loan tenure will be decided. Before you retire i.e 58 years you should be clearing the loan.

Existing Loans : If you have any exiting Loans, you will be paying EMI so you overall eligibility would come down for the next loan.

Credit Score : Banks/NBFC would look at your credit report and based on how you have paid will decide to go if they want to give you loan

Property : When you are asking for Rs 80 lac loan, it would mean at least the property should be Rs 1 crore. Technically the price of the property should support it and you have to pay 20% from your self funding and 80% you can take loan. It should not be like for Rs 10 Lac property you are paying Rs 1 Crore.

All banks will not approve all the properties. In case your property is not approved by SBI, then it would take time for the process.

Plan your loan well, so that you will close faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

-Vijayananda Reddy Kalluru
Founder and CEO of LoanYantra | Get Home Loan Online

 

Is it a good idea to take a second home loan?

Not at all a bad Idea, if you find the right property to invest. As the existing outstanding loan amount is only 13 lakhs the maximum interest you would be paying is less than Rs 1 lac. You can buy one more property to increase your assert.

First thing you need to do is, to check if your existing home loan rate is as per the market rate. Incase not, then try to correct to new rate by approaching the bank. As 13 lac is not a big amount try to close the loan as soon as possible so that your loan eligibility is high and you can invest in bigger and better property.

Now coming to the tax saving, regarding the second home loan.

Before Budget 2017 – Before Budget 2017, the loss from house property (in case of rented property) which is basically the interest paid on home loan was allowed to be adjusted from remaining incomes without any limit. It would reduce tax liability to a great extent. Several taxpayers considered investment in house property as a means of tax planning while creating an asset with a long term view.

After Budget 2017 – But now the budget 2017 will limit this set off of loss from rented house property to Rs 2 lakhs per annum. This change in budget would reduce the tax savings in comparison to pre-budget.

Deduction for home loan interest is now same for both rented and self-occupied property i.e. Rs 2Lakhs.

Note: The income tax act says that those who own more than one property, must treat one of them as rented property. Basically only one property can be treated as self occupied and others have to be assumed to be rented. Tax has to be paid on notional rent. A lot of people who own two properties, assumed the loaned property as rented and managed to claim the entire interest as deduction. Such taxpayers can no longer do so.

This change will bring parity between the tax benefit allowed on self-occupied property with the property that is rented.

In both cases loss which can be adjusted is limited to Rs 2lakhs.

Carry forward of loss

Unadjusted loss can be carried forward to 8 years. However in this manner, loss which has not been set off will keep on accumulating (every year’s unadjusted loss is carried forward) and is practically speaking a dead loss.

Plan your loan well, so that you will close faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

-Vijayananda Reddy Kalluru
Founder and CEO of LoanYantra | Get Home Loan Online

 

 

 

 

 

Can I avail a loan against another property if I already have a home loan from a bank?

Yes you can avail Loan Against Property for other loan provided you meet the eligibility requirement.

If you are falling short of eligibility, how do you increase it ?

  1. In case, if your spouse is working to increase the eligibility you can add the spouse as a co-applicant to increase the eligibility.
  2. In case if you have rented your other house, then you can show rental income and increase your eligibility.
  3. In case if you have a small loan where in you are paying high amount as EMI, then try to close it to increase the Eligibility.
  4. In case if your tenure of existing home loan is less than maximum tenure you are eligible, then increase the existing home loan tenure to get more loan.
  5. Last but not least, incase if you are paying higher interest rate then the market rate, first thing to do is to correct the EMI to existing rate and reduce the EMI. This would also increase your loan eligibility.

Your eligibility requirement would depend on following things

To get a loan will depends on following factors

  1. Your Salary or Your Business turnover + other incomes
  2. Your age
  3. Your Existing Loans
  4. Your Credit Score.
  5. Last but not the least the Property you are buying & Own contribution to pay 20% of the property

Your Salary : You should be earning enough to pay the EMI + at least 40% of earning for your living expenses.

Your Age : Based on your age, maximum Loan tenure will be decided. Before you retire i.e 58 years you should be clearing the loan.

Existing Loans : If you have any exiting Loans, you will be paying EMI so you overall eligibility would come down for the next loan.

Credit Score : Banks/NBFC would look at your credit report and based on how you have paid will decide to go if they want to give you loan

Property : When you are asking for Rs 80 lac loan, it would mean at least the property should be Rs 1 crore. Technically the price of the property should support it and you have to pay 20% from your self funding and 80% you can take loan. It should not be like for Rs 10 Lac property you are paying Rs 1 Crore.

All banks will not approve all the properties.

Plan your loan well, so that you will close faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

-Vijayananda Reddy Kalluru
Founder and CEO of LoanYantra | Get Home Loan Online

 

 

What is the role of a co-applicant in home loan in India?

Co-applicant for a Home Loan – Who can be a Co-applicant ? Advantage & Disadvantages of being a Co-applicant.

In the present day, when the cost of living is going up and usually both spouses work, having co-applicant becomes more of a necessity than a requirement. There is no legal requirement to have a co-applicant.

In order to enhance the loan eligibility, a borrower has an option to resort to by having a co-applicant. This way, the total eligible income for the purpose of computing the housing loan increases, thereby resulting in higher loan eligibility.

Home loan co-applicant is a person who shares the equal responsibility towards the repayment of the home loan. Such type of home loans are called Joint home loans. Whereas a co-owner is the person who has a share in the property and rights on the property too. A co-owner of a property can be the co-applicant in home loan. But it is not necessary that the co-applicant of the home loan is the co-owner of the property.

Who can be a co-applicant

A bank does not permit friends or relatives who are not blood relatives to take a loan jointly. Only if the co-applicant receives income from a regular source will that income be considered for determining the loan eligibility.

In most cases, spouse is the most common and preferred combination.

In case of parents and children , these rules will apply:

  • Father/ Motherand son

If the applicant is the only son, he can jointly apply with his father with both the incomes being considered. The property should be in their names jointly and it does not matter who the main owner is. This is because in any case the son is the legal heir of the father’s property.

  • Father/ Motherand sons

In case a person has two or more sons and if he wants to apply jointly with one of them, he should not be the main owner of the property. This is because, on his death, his children should inherit the property jointly and may cause an inheritance dispute.
The father may only be taken as co-applicant and his income may be considered for the loan. He may be a co-owner or not own the property at all. Under no condition should he be the main owner of the property.

  • Unmarried daughter and Father/ Mother

An unmarried daughter can apply jointly with their father. However, the property should only be in the name of the daughter and the income of the father should not be considered . This is to avoid any legal complications on the subsequent marriage of the applicant .
Where applicant is the owner and has a son and a daughter, an affidavit may be obtained from the daughter that she has no claim on the property.

In case of Brother and brother/sister

Home loan co-applicant approval is subject to certain terms and conditions like address of both should be same which means a joint family and intent to stay together in joint family in future. It is at the sole discretion of the bank.

Who cannot be a co-applicant :

  • Father / Mother and Married Daughter
  • Brother and Sister
  • Sister and Sister

Documents Needed : Documents are needed from both the applicant and co-applicant.

General home loan documents needed are :

  1. Identity proof
  2. Address proof
  3. Salary slips
  4. Bank statements

Loan Eligibility

A common doubt is – ‘Will the home loan eligibility amount increase if we opt for a joint home loan?’ Yes, it will. Banks will be ready to offer you higher loan amounts if you opt for a joint home loan. The reason for it is that your repayment capacity increases as there are now two people who repay this loan. How much it would increase depends on the income of co-applicant. Apart from income, organization reputation is also considered. Be sure that you compare multiple loan offers before deciding on loan eligibility.

Benefits of being a Home Loan Applicant

  • Increase Home Loan Eligibility :

If you are not the co-owner of property but would like to help your spouse or relative to increase their Home Loan eligibility. In this case, you may consider being home loan co-applicant. It is absolutely necessary that you should be aware of all the risks and legal liabilities.

  • Taxation Benefits :

From a taxation point of view, a joint home loan is also beneficial as all co-borrowers can claim tax deductions under section 24 (upto Rs. 1.5 lakh) of the Income Tax Act against interest paid and under Section 80C (up to Rs. 1 lakh ) against principal repaid.

The tax benefits that can be claimed would be in proportion of the share that the individuals have in the loan.

Dis-advantages of being a Co-applicant

  • CIBIL score of the co-applicant will be impacted.
  • Reduced credit eligibility : Being a co-applicant will reduce the credit eligibility to the extent of 50% of home loan value. It may impact approval of any future credit requirement of co-applicant.
  • Operational Hassle : It is an operational nightmare for home loan co-applicant at the time of availing or closing the home loan.

Repayment Options

The repayment process for joint home loan is similar to that of a regular home loan. The payment, however, has to be made through one cheque.

Renu Sud Karnad, manging director, HDFC, explains, “Payments can be from a single or joint account by way of cheques or Electronic Clearing System (ECS).

“Another way of repayment could be that the co-borrowers share the number of EMIsbetween them such that a specific number of cheques can be issued by one borrower and the balance by the other,” says Suvrat Saigal of Barclays Corporate India.

What if Dispute Arises

The problem arises when one of the co-borrowers refuses to repay the loan. Be warned that each party would be liable for part of repayment or up to as much as all of the repayments.

Renu Sud Karnad of HDFC says, “It does not matter whether the payment is made in the normal course by only one of the joint borrowers as long as the fullEMI is paid as per schedule”.

In the event of default, the lender will proceed with the normal recovery process which may include a legal recourse against all joint borrowers.

Solution

  • Agreement between all Home Loan Applicants –

To avoid any legal dispute in future, it is advisable to all home loan applicants to sign a separate legal liability agreement on a stamp paper. And get the paper notarized. This agreement will clearly segregate the liability of each party.

  • Online Term insurance Plan –

What if bank insists on a co-applicant. If the bank insists only to hedge risk against home loan repayment, then a simple solution is that the primary borrower can buy an online term insurance plan and can submit a copy of a that policy assuring bank that bank that he is insured against home loan.

Conclusion

Joint home loans are definitely beneficial as compared to normal home loans. In case you are looking for a home loan and you can speak to your blood relatives to get a joint home loan, be sure that the EMIs are paid as per schedule.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

-Vijayananda Reddy Kalluru
Founder and CEO of LoanYantra | Get Home Loan Online

 

 

 

 

 

 

 

 

 

 

 

 

 

 

What are the different types of home loans and Explain?

Various kinds of home loans offered by financial institutions in India.

Home Purchase Loan

These are the basic home loans for the purchase of a new home. These loans are given for purchase of a new or already built flat/bungalow/row-house. Home purchase loan is most popular variety among home loan product offered by the Financial institutions, even government encourages Loan seekers by giving tax incentive.

Home Improvement Loan

These loans are given for implementing repair works and renovations in a home that has already been purchased by the customer. It may be requested for external works like structural repairs, waterproofing or internal works like tiling and flooring, plumbing, electrical work, painting, etc. Generally people consider option of personal loan to do this kind of works, home improvement loans are lesser than personal loan interest rate.

Home Construction Loan

These loans are available for the construction of a new home. The documents required by the banks or bank for granting customer a home construction loans are slightly different from the home purchase loans. Depending upon the fact that when customer bought the land, the lending party would or would not include the land cost as a component, to value the total cost of the property. Some banks don’t deal with this type of loan.

Home Extension Loan

Home Extension Loans are given for expanding or extending an existing home. For example addition of an extra room, etc. For this kind of loan, customer needs to have requisite approvals from the relevant municipal corporation. However subject to technical valuation of the bank.

Land Purchase Loan

Land Purchase Loans are available for purchase of land for both home construction or investment purposes. Therefore, customer can be granted this loan even if customer is not planning to construct any building on it in the near future. However, customer has to complete construction within tenure of three years on the same land. only few banks in india offer this type of loan and sanctioned amount is based on title and location of the property.

Bridge Loan

Bridge Loans are designed for people who wish to sell the existing home and purchase another. The bridge loan helps finance the new home, until a buyer is found for the old home. This loans are short period in nature having a tenure of minimum 2 weeks to 24 months maximum.

Balance Transfer

Balance Transfer loans help customer to pay off an existing home loan and avail the option of a loan with a lower rate of interest. Customer can transfer the balance of the existing home loan to either the same banks or any another banks, people opt for these type of loan if they realize fact i.e. small change in interest will influence the burden of EMI’s to them. For more details check “Cost of switching home loans to new lenders?”

Stamp Duty Loan

These loans are sanctioned to pay the stamp duty amount that needs to be paid on the purchase of property.

NRI Home Loan

This is a special home loan scheme for the Non-Resident Indians (NRI) who wish to build or buy a home or land property in India. They are offered attractive housing finance plans with suitable reimbursement options by many banks in the country.

If you plan your home loan well, you will be able to close it faster and your home will be fully yours.

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

-Vijayananda Reddy Kalluru
Founder and CEO of LoanYantra | Get Home Loan Online

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

What will happen if the rate of interest on home loans decreases?

It would based on what you have fill while applying your loan.

They are two possibilities, when rate of interest on home loan decreased.

  • Option 1: Fluctuating EMI
    • Here your EMI will be reduced.
  • Option 2. Fluctuating Tenure
    • Here your Tenure will be reduced.

Let me explain which one is advantage of the both .

First, when you have applied for a loan with the floating rate of Interest, you have to opt what is the change you like to have from above two options.

By default most of the banks the Option 2 is by default, i.e tenure would decrease if the rate comes down and tenure would increase if rate goes up.

Which one is better ?

If you have opted for Option 1, that EMI should change then your tenure gets fixed and when rate comes down your EMI will reduce and when rate goes high your EMI would increase. So if you are contributing maximum of your salary towards EMI then be cautious about it. It can hurt other financials.

When the rates are downward trend the keeping the EMI constant would reduce your tenure drastically. For example, for a Rs 50 lac loan for 20-year tenure if the rate drops by 0.50% then your tenure would reduce by 30-months that is (2-years 6 Months) almost saving Rs 15 lac. But if the rate are upward trend then keeping your EMI constant then your tenure is going to go up same as above by 30-more months of EMI. Which would mean Rs 15 lac more.

So, its always good to manage your loan and keep changing EMI according to your financials. In interest rate downward times decreasing Tenure is good and in interest rate upward trend increasing EMI is good.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

-Vijayananda Reddy Kalluru
Founder and CEO of LoanYantra | Get Home Loan Online

 

 

 

 

 

 

Can I apply home loan from two different banks and can avail the best one after they both provide an approval letter?

Yes You Can .. but You Should Not.

You can apply for as many banks and NBFC you like to apply. But you need to know what are the disadvantages you will have if you apply for multiple loans.

Disadvantage of applying with multiple banks for home loan for same property ?

  1. Every bank will check your credit report and its a hard touch. Which means on every time bank pulls your credit report your credit would come down by certain points. Also it would be reflected in you Credit report who had queried it. So it affects your credit score and it affect your loan eligibility over all
  2. Every bank or NBFC would charge you a processing fee. Its compulsory to take a cheque leaf as a processing fee. If the banks or NBFC say ZERO-Processing fee, that would mean they would refund it once the loan is disbursed, it will not be refunded if its only sanctioned and not disbursed. So now you will have to pay to multiple banks.
  3. In time to come all the banks are maintaining a common data base of the loan process state for a certain property. If one bank is processing then other bank till NOC from other bank will not process. This system is under proposal and will be available shortly. Right now Banks and NBFC use CERSAI for it.
  4. Last but not the least, you will have to face multiple bankers, have to submit multiple times the same documents and the pressure the banker or brokers would put is not pain free. So avoid it.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

Instead of applying with multiple lenders its always good to get right suggestion and apply for one lender.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

-Vijayananda Reddy Kalluru
Founder and CEO of LoanYantra | Get Home Loan Online

 

 

 

 

 

 

 

 

 

 

Is floating rate of a home loan always higher than fixed rate?

To start of with its always other way round.

Fixed rate is always higher than the floating rate.

Why do the bank take higher rate for Fixed compare to Floating rate ?

Banks normally charger 0.50% to 2.00% more than the Floating rate based on the fixed period tenure. You can opt for 2-years fixed, 5-years fixed or 10 years fixed or fixed till closure. Based on the how fixed tenure banks would charge higher than the floating. Banks higher higher so that they are covering the risk in future. If the REPO rates go up then banks have at least don’t make loss on your loan. For example people who have availed the loan say in 2000 with fixed and still holding it would be paying only at say 7.50% . To cover this risk they charge more.

When do you opt for Fixed rate Home Loans ?

  1. If the rates are upward trend then you can go for Fixed Rate of Interest. Right now the interest rates are downward trending so be on Floating and convert to Fixed later.
  2. If you want to be more secure and don’t want to be affected by rate changes then opt for Fixed rate. In case if you can manage your loan well , i.e make the necessary changes in the loan by making part-payments and correcting to new rates then go for Floating rate.

Disadvantage of Fixed Interest rate Home loans?

  1. If you want to refinance from a different bank, because they are giving a better rate then you might have to pay 2% as penalty on the outstanding amount. Where as in floating rate, there are no penalty if you are refinancing.
  2. If the rates are downward trending then you are at loss.
  3. Look into the conditions banks would apply for fixed loans, like the part-payments, increase of the EMI or pre-closure by self funding. They vary from floating rate. Normally they are free for floating rate of Interest for home loans

My suggestion would be if the loan amount is small or the tenure of loan is small then go for Fixed rate of Interest for Home Loan or else its good advice to go with fixed rate of interest and manage it well.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

-Vijayananda Reddy Kalluru
Founder and CEO of LoanYantra | Get Home Loan Online

 

 

 

 

 

 

After all my research about home loans in India I have come to the conclusion that every bank has its negative so which bank is the least problematic?

Every bank and every loan product has advantage and its own disadvantage.

When you are selecting a bank , you nee to be clear on what you want.

  1. Faster processing of loan. With all the documents in place
  2. Faster processing of loan. With some documents in place
  3. No processing fee and other fee
  4. Want more LTV. More Loan eligibility
  5. Lesser Interest rate
  6. Need OD home Loans. Smart saver
  7. No other charges in future
  8. Need to add co-applicants like Mother, Father, Brother or even Father-in-law and others
  9. With Bad credit score with all NOC in place
  10. Less charges and overhead while processing the loans
  11. Easy to pay Part-payments and accepts any amount as part-payment
  12. Easy to foreclose the loan
  13. In future want to avail top-up loans
  14. Want interior loan with the same rate of home loan.
  15. Pre-sanction of the loan.
  16. Loan for property in the outskirts of the city.
  17. Loan for the property with deviation.

Based on above, you would have only few products and few banks which you give you hassle free loan.

I would recommend you check your eligibility on home loan comparison portals like LoanYantra | Get Home Loan Online and they would help you in choosing the right home loan.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

 

 

 

 

 

 

 

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