Today, getting a dream house is incomplete without getting a home loan. Thus, getting an ideal loan is as important as finding an ideal home for you and your family. In a competitive world, there are not less than 50 home loan lenders who are keen on giving home loans to people looking to buy a home seeking these groups. However, the big question that comes into the picture, whom (lender) should you choose for getting your home loan. After all, taking a home loan is announcing a long-term commitment to your bank. Hence you need a bank that can give you a pleasing banking experience. Let's check the ten tips for a best home loan experience in the following paragraphs:
1). Start with saving for your down payment
First things first, you have to start planning for your finances before you think of buying a home. You have to chalk out your expenses and income first and check your monthly budget. Your next step is to start saving a certain amount of money, which will eventually help in paying for your down payments. Generally, the down payment would range in between 2.5 to 20 percent depending upon the local market and the type of loan you have availed from the lender.
2). Have a Look at your Credit Score
A sound credit score is essential for maintaining sound financial health. This can attract a good number of lenders to offer you home loans. As Rome was not built in a day, so is the credit score. You have to slowly and steadily develop a sound financial history. Keep checking your credit score on a regular basis either requesting the agencies working for it so that you end up getting a good credit profile. All you need is 750+ CBIL Score to get a lucrative loan offer from the bank. However, with less 750 scores, you are likely to lose the opportunity of availing a home loan.
3). Keep all your financial documents in order
Needless to say that whenever you are treading the path to buy a home with a home loan, you have to keep all your home loan in perfect order. Keeping all your documents like I-T Returns, Salary Slips and Bank statements will add speed to your home loan application.
4). Use the loan calculator
Tools like home loan calculators can help you in understanding the amount you can afford. It allows you to work out your monthly EMIs, your interest rate, down payments, the cost, etc. This tool can help you in getting a fair idea about finding the amount you need to borrow and about your earnings. You can find several home loan calculators online.
5). Compare several options
Avoid going for a ride by loan options having a similar rate of interest. Several factors can make one loan expensive and other less expensive. You need to understand the various factors including the points, fees and other elements, which calculate the loan amount for your home.
6). Go for the pre-qualification
One of the best ways to know your loan capacity for your loan is to opt for pre-qualification. Generally, the real estate agents ask the buyers to go for this prequalification test so that they get an idea about your financial health and choice. The process involved in it simple and it requires only some basic financial information like savings, income and your investment details.
7). Understand the numerous loan options
People going for home loans avail different home loans. Your friend has gone for an adjustable rate loan, while your office colleague could have gone for a floating interest rate, so you have diverse options when it comes to getting a home loan. Everyone who plans to buy a home as his or her unique financial conditions and the kind of loan you choose should completely rely on your financial conditions.
8). Don’t let loose your credit score throughout the loan process
If you think that your chosen bank will not go to re-check your credit score, think again. The lenders do check and recheck the credit score of the borrower. While doing so, if they find some hits and misses in your CBIL score, then they would review your application, and you end up losing the chance of availing a home loan. So, better maintain your credit score till you finally get the loan and continue the excellent rest of the year.
9). Read all loan-related documents very carefully
Needless to say that it is imperative to check all the documents and statements carefully before you sign the documents. Read all the clause and understand its implications along with the terms and conditions. Do not shy to ask any question if you are stuck anywhere.
10). Have a better understanding of the foreclosure norms
There are some changes taking place in foreclosure norms as we heard last year RBI canceling the foreclosure penalties. This will help in knowing that how much do you have t pay extra while paying the extra money. Lastly, don’t forget to check the GST Rates that are applied with 18% since July 2017.
If you follow these tips, you are bound to make your loan application process light and straightforward experience. Try these and good luck with your smooth home loan application process.