Purchasing a new home can be a stressful task, particularly if you are doing this for the first time. Whether you like this or not, you are hoarded with several suggestions as well as tips from your pals and family, which may overwhelm you. So, how can you make your experience of availing a home loan a smooth experience? Follow the tips listed before.
However, before you go ahead to read and understand the tips, ensure to remember that to decide on any of the lenders of your choice for a home loan, you must use an online home loan calculator. This means you can use the LIC home loan EMI calculator or ICICI home loan EMI calculator, or the online home loan EMI calculator of any other lender to determine your EMI and your repayment tenure as per your preference. With the EMI calculator, you can even understand if the interest constituent is as per your preferred limit or budget. In case it is not, then consider opting for any other lender or negotiating the interest rate with the lender of your choice.
Identify your budget for your home.
As the property is going to be an investment for the long term, it is important for you to know how much you can stretch on the home loan depending on your existing income and liabilities. It is recommended not to look for properties of more than 3 times your family’s annual income. Look out for a property or plot for which you can simply arrange a down payment, stamp duty, and brokerage. Once done, you can use the online home loan EMI calculator to get an idea about your monthly EMIs. It can assist you in taking an informed decision.
Check your credit profile or score.
One of the most crucial aspects that a lender or bank will authenticate is your credit profile or score. By reviewing or analyzing your credit score, you can gauge your credibility. It is advised to have a score of 750 and above. Holding a high score can even fetch your other crucial benefits like decreased interest rates, processing charges, etc. If you want to ameliorate your score, then you can do this by timely repaying your credit card dues or your outstanding loan bills in full, etc.
Save for the down payment.
Based on your lending institution or bank, the range of down payment might differ. While designing your budget, ensure that you put aside the required funds for your down payment
Get Access to : ICICI Home Loan EMI Calculator
Keep your documents handy.
During a home loan application, you are required to submit different documents. Ensure that you have such documents ready so that you can expedite the application procedure. Ensure you have all your mandatory documents like identity proof, address proof, pay slips, bank statements, form 16, and others handy.
Compare the offers
Before you select a home loan, ensure that you compare the offers available. A few lenders might provide a lesser rate of interest along with other crucial benefits. Compare such offers and pick the home loan offer that suits your requirements the best.
Use the online home loan calculator.
Using the online home loan calculator is looked upon as one of the best financial tips for a home loan, as it assists you in planning out your budget in a manner that is data-driven.
Understand details regarding your rate of interest
The interest rate offered on your home loan plays a crucial role in deciding the home loan cost. Ensure to discuss with your bank your rate of interest, may it be a floating or fixed rate of interest. This may help you prepare as well as estimate your repayments.
Check for pre-qualified offers.
With a pre-qualified home loan offer, you can speed up your whole application procedure and verification process. To get a pre-qualified offer, you must place your financial info, like your savings, income, and investments, along with property documents.
Actively respond to lenders.
In case you are contacted by a lender about any further requests or requirements, ensure that you respond to this instantly. This can assist the lender in keeping your application request active.
Understand distinct loan options
There are several options available when it comes to purchasing a home loan. For example, you can select either a fixed rate of interest or a floating rate of interest. Make sure that you check out with your lender regarding all the options available.
Maintain your credit habits for quick processing of a loan
While processing your home loan application and verifying the same, lenders might check your score as well as your credit profile. So, it is a prudent choice if you continue with your good financial habits even when your home loan application is getting processed.
Avoid submitting multiple loan requests.
Buy your home just with the home loan if you are looking for a credit option. Do not depend on a personal loan in case you are short of finances. Also, avoid submitting multiple loan requests for a home loan directly with the lender, as this is looked upon as a hard inquiry, which lowers your credit score every time you place a request for a home loan with the lender. Instead, consider placing a request for a home loan through online lending marketplaces. A request placed for a home loan on such platforms is looked upon as a soft inquiry, which does not impact your score in any way.
Assess under the hood
When looking for a suitable home, do not forget to inspect the home thoroughly. Ensure you look through each corner of the home, so you do not require dealing with any kind of issue after you invested in the same through a loan. This would even assist you in preparing for any kind of modification that you want to make to your home in the future after availing of it.
Avoid running after enticing offers.
Builders might entice you with offers like ‘book now and get a 4-wheeler for free’ or ‘place an application for home now and get cashback and discounts. Ensure to opt for only the sensible offer which you think may benefit you.