The process of finding and buying your dream home might take a long time and extensive study. You must first visit a number of builders in different areas of the city in order to locate the property you desire to purchase. The next stage is to finance your property purchase, for which you will probably apply for a loan from a bank or other lending institution.
The majority of us will normally consider the house loan interest rate, processing fees, and the supporting documentation that will enable us to obtain the appropriate amount with the least amount of work. Companies that finance homes now provide a variety of tailored repayment options to meet the needs of their clients. Some of these alternatives provide individuals freedom in how they repay the mortgage while also improving their ability to repay by providing them with some tax advantages.
The various repayment options that a borrower must weigh before choosing are listed below:
1) A mortgage with a later start date for the 30 Lakh Home Loan EMI
Various banks provide their customers the opportunity to start their EMIs like 35 Lakh Home Loan EMI later. Some banks provide Flexipay home loans that allow borrowers to select a moratorium period, or time during the loan term when they are not obligated to make any payments. This period can be anywhere between 36 and 60 months. They are simply obliged to make the pre-EMI interest payment during this time and no EMIs. Once the moratorium period has ended, the EMI will begin and grow over the ensuing years at a predetermined rate. This loan allows borrowers to obtain a home loan of up to 20%, unlike a regular home loan. One should be aware that only salaried and working professionals between the ages of 21 and 45 are eligible for this type of financing.
2) A home loan connected to unused bank savings
There are some mortgages where the bank will let you link your opened current account to your mortgage account. How much excess cash you have in your current account affects how much interest you pay on your mortgage. The current account is open for withdrawals and deposits as needed. Your home loan’s interest rate will be determined by subtracting the current account amount from the outstanding balance.
It is important for borrowers to understand that banks will charge you an additional interest rate for these loans, which results in higher 30 Lakh Home Loan EMI even when the interest load is lowered.
3) A mortgage with rising EMIs
You might wish to look at the Step Up Repayment Facility provided by several banks if you’re looking for a house loan whose 35 Lakh Home Loan EMI keeps rising beyond the first few years. With these loans, you can get a bigger loan amount and pay smaller monthly payments in the beginning. Then, the payback is hastened in accordance with the anticipated increase in your revenue. There is no moratorium period with this loan, and the actual EMI begins on the first day. As the loan is paid off early, larger 30 Lakh Home Loan EMI payments help to lower the interest cost. This choice is intended for people whose incomes are expected to rise in the near future.
4) A home loan with a lump sum payment for a structure that is being constructed
You normally are only obliged to service the interest on the loan amount up until the final payoff and then pay the EMIs when purchasing a property that is still under construction. You might choose to begin making 35 Lakh Home Loan EMI payments on the total sums issued if you want to begin principle repayment right now. The amount paid will be reduced for interest and the remaining amount will be applied to the principle balance. For instance, starting to make payments on an EMI of xx on a loan for Rs 50 lakh will reduce the remaining balance to about Rs 36 lakh by the time the house is built. Naturally, the new EMI will be less than what you have been paying over the last 36 months. One should be aware that the principle paid during the building phase is not tax deductible, but that the post-occupancy tax deduction is available.
Home loan with waived EMIs
A repayment option called Fast Forward Home Loans enables the forgiveness of 12 EMIs in exchange for on-time payment of all other payments. Here, after 10 years, six months of the 30 Lakh Home Loan EMI are cancelled, and after 15 years from the first disbursement, another six months are cancelled. Even though the interest rate is the same as it would be for a regular house loan, the loan term in this programme must be 20 years. The smallest loan amount is Rs. 30 lakh.
Telescopic Payback: It is recommended to choose this loan repayment type when the qualified home loan amount is lesser. It is appropriate for the younger generation who have recently started their careers. By extending the repayment duration to 30 (thirty) years, they might obtain a loan through this scheme for a higher amount. The 35 Lakh Home Loan EMI is smaller, and if the borrower has extra money, they can choose to pay off the loan early.
How to move forward towards decision
Since it has no constraints and is more flexible, a standard home loan even for 30 Lakh Home Loan EMI is preferred. However, you might wish to consider one of the aforementioned options if your own financial situation necessitates a different approach. Sit down with your banker or a trusted friend or relative to discuss your financial condition, project your income for the foreseeable future, and decide on the sort of loan. It may come from any lender that would support your financial objectives.
Do not forget to account for the total interest paid on the loan. Make sure you have a plan in place to pay off the entire sum as soon as you can, regardless of the loan you finally decide on. Only when you possess all of the ownership in a property can you genuinely call it your own.
