Home Loan The average home loan tenor in India is 25 years. In other words, most people choose to repay their home loans over 25 years. 25 years is a long time. During this time, things will change for you. You may get married.
If you are married, you may decide to start a family. If you do so, you will realize that education has become expensive and most people find it difficult to put a child through college without taking external financial assistance. You may also find yourself paying for medical emergencies you never anticipated.
Home Loan In other words
you will find that as time advances, your expenses will increase and the quality of your expenses will change too. In all likelihood, your income will increase with time as well. If your income increases with time, it will be easy for you to accommodate all the added expenses. However, if your life takes an unexpected turn, accommodating these new expenses can become troublesome.
Home Loan In such a scenario
your home loan EMIs can also easily become a huge burden. Individuals availing of a home loan must consider these things when deciding the home loan amount and the home loan tenor that would be right for them. They must always choose a loan amount and EMI that they will find easy to repay even if life goes unplanned. Home loan applicants must also try and secure the lowest home loan interest rate in India they can get. Read on to know how a low interest rate on your loan makes life easier, especially when life takes unexpected turns.
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Home Loan Lenders charge interest on the money you borrow as a home loan
When a loan borrower repays a home loan, they pay the principal amount along with interest. The home loan interest rate that your lender offers you will directly affect the total interest you pay on your loan as well as your home loan EMIs. When you secure a loan on low home loan interest rates, your home loan EMIs are low and economical. The total interest you pay on your loan is also on the lower side.
This helps keep the cost of borrowing funds low. However, when you are forced to accept housing finance on high home loan interest rates, not only are your home loan EMIs high and therefore, you risk defaulting on loan repayment during a financially difficult period, but the cost of borrowing money is also high and therefore, the return on your investment is also low. It is for this reason that borrowers are advised to try and secure a loan on the lowest home loan interest rate possible.
Home Loan One of the things that goes a long way in helping borrowers secure housing finance on low home loan interest rates is doing research and negotiating with lenders for a low rate of interest. There are many, many lenders in the market. From banks and NBFCs to commercial lenders, there are many different options to choose from and until you explore all the options available to you, you won’t know the best you can get. Therefore, if ever you decide to secure housing finance, talk to as many lenders as possible and see what you can get.
Reach out to lenders and ask them to give you an idea of the home loan interest rate they will be willing to offer you as well as the loan amount they will be willing to sanction. Once you have all the loan offers in hand, use a home loan calculator to compare all the different offers. A home loan calculator is an online tool that lets users calculate loan EMIs, total interest payout on the loan and the total cost of borrowing funds.
Home Loan The home loan calculator helps borrowers compare different loan offers and select the right one for them. Other than that, a home loan calculator can also help with monthly budgeting and financial planning. When you know how much you will need to pay each month in EMIs, deciding how to spend your money and where to save becomes easier.
If you want to secure a low-interest-rate home loan, you must also build a very solid CIBIL score, maintain a stable job and income and opt for a low LTV ratio loan by paying as high a down payment as you comfortably can.
