Everything You Need To Know About a Home Loan:

In India, most of us dream of owning our home someday. But think otherwise after seeing the exorbitant prices. Because it's practically a bit difficult for the common people to put up such a hefty amount a once and buy their own home. To help in achieving their dream, banks and financial institutions give loans. These loans can be for various purposes like home renovation, home extension, home purchase, land purchase, or for home repair. A home loan is basically an amount any bank or a financial institution gives to a person for the home purchase which she/he has to repay in a certain time period which depends on your choice. 

This loan amount can not only be used for home purchase but also for other purposes. A loan amount depends on various factors such as age, monthly income, your CIBIL score, property location/value. This loan can be availed by both the salaried and self-employed individuals. These factors usually vary from bank to bank and before applying for a loan, you should closely check all the options and apply after doing it. 

Prominent Features of a Home Loan:

Let’s have a look at some of the amazing features of the loan given by the bank for the home purchase.

• The rate of interest starts from 8.60 percent per annum. It depends on the bank to bank. Home Loans are priced on the basis of MCLR (Marginal Cost of Lending Rate).
• You can get a loan for the maximum tenure of 30 years. 
• You can repay the loan amount by the flexible repayment options.
• EMI (Equated Monthly Installments) options for the repayment of your loan amount by which you can pay the amount gradually every month.
• Interest rates don’t change if MCLR changes. Thet can only be changed after one month. 
• The bank decides the loan amount based on the loan-to-value (LTV) ratio. Higher the LTV ratio, riskier the loan to a lender. 
• The eligibility of CIBIL score varies from bank to bank when it comes to the prospect of giving a loan against the property.
• You can also save the tax up to Rs 1.5 Lakhs on the principal amount and up to Rs 2 Lakh on interest. 
• You’ll also get a home loan balance transfer facility. 

How to use a Home Loan EMI Calculator:

Before opting for a loan, one should always check the amount of EMI to calculate the financial budget accordingly so that it doesn’t put a hole in your pocket. With the help of the Home Loan EMI Calculator available online, you can easily know the monthly installments by putting the very basic details into it which are as follows.

• Loan Amount
• Rate of interest per annum
• Tenure period (number of months/years)

Just by putting these details, you’ll get the EMI amount and also the total interest you have to pay over the period. The rate of interest varies from one bank to a different bank dependent on various factors. 

Eligibility Criteria for getting a home loan: 

There are certain criteria for getting the loan amount from the bank in order to own your home which are as follows.

• A salaried applicant must have the age of 21-60 years.
• A self-employed applicant can have a minimum age of 21 years and a maximum of 65 years. 
• Annual income should be a minimum of Rs 1,80,000 to be eligible for getting a loan amount.
• The applicant’s CIBIL Score should be 720 or above. Usually, a person with a CIBIL score of less than 720 has to pay a higher rate of interest compared to a person with a credit score of 720 or above than it.