It is often mentioned that obtaining a dream house calls for big expenditure for most of the investors. Some people today devote a extended period of time, garnering their savings to fulfil this dream, although other individuals opt to take a loan (credit) to fulfill this dream.
Getting accomplished your self assessment about the repayment capacity, place of your dream dwelling, amenities and other fancies that you would like your dream household to have. It really is time for some critical exercise of picking your HFC.
Deciding on a HFC requires intense care and appropriate consideration, and thus following the below-talked about pointer will make this workout less complicated. Previous record of such institutions really should be effectively checked as it will be a extended term connection between you and institution. Assure that the whole process does not finish up becoming a entire day headache or nightmare for you, therefore prudent actions whilst deciding upon the financer.
1. Rate of interest
This is exactly where it all begins. Though the rate of interest provided by most HFCs is extra or less the similar on paper, some degree of bargaining in most circumstances, leads to a lowering of rates by as considerably as .25 to .50 percentage points. Far more so if your profile occurs to match the requirement of the HFC. The lowering of interest price has a important effect more than the long term even though the difference is not so noticeable over the near term. For instance, a .50% interest rate ‘concession’ on an Rs 1,000, 000 loans more than 20-year tenure will cut down your liability by upto Rs 72,000. But care demands to be taken to make sure that the difference is not being offset elsewhere by the HFC below the guise of other ‘charges’.
One ought to also be careful about teaser price offer you, as they are at times genuinely teasing. They benefit you for a short-term – say couple of years (till the fixed interest rate tenure), but later as floating rate starts applying they dig a larger hole on your wallet.
2. Calculation of the exact residence loan quantity
Here, HFCs differ in their calculation of the loan amount to be disbursed. Some HFCs calculate the quantity to be disbursed on the basis of, say, the gross salary though some HFCs calculate it on the net salary. This may make a difference to folks as the loan amount and the EMI will vary across HFCs. One requirements to appear into this and get a comparative analysis done across HFCs, to realize which HFC presents the finest deal. Also one particular should really verify whether or not the HFC is providing pre-EMI and tranche based EMI repayment option. This will support one particular whilst taking loan for an under construction home, as this provides them an option to spend interest only on the portion of the loan disbursed or to decide on the instalments they want to spend, till the time the property is prepared for possession.
three. Right after-sales service
And you believed after-sales service was synonymous only with customer durables! No – it applies to virtually almost everything, and so also applies to HFCs. In truth, it is extremely vital whilst choosing an HFC. An HFC can differentiate itself with fantastic soon after sales. Take the example of post-dated cheques (PDCs). It is common practice to give 36 PDCs through the time the loan is disbursed. It is after 36 months are over that right after-sales will play a function. How diligent are the HFC’s adhere to-ups? Are cashfree.com/payment-gateway-india prompt? Are reminders timely? Additionally, throughout the monetary year-end, the HFC ought to be punctual in giving the borrower interest paid certificate (elements of interest and principal amount paid in the economic year) so that he can file the required documents for availing tax advantages (beneath section 24b and 80C of the Revenue Tax Act) on dwelling loans.
four. National presence
The HFC should be present across the country or at least have branches in all main metros and towns. This gives an individual an easier accessibility. This assumes significance if the present job of an individual is of a transferable nature (e.g. bank job, defence personnel) or if he requirements to make long and frequent outstation visits (e.g. consultants, businessmen). The individual should not be put by means of the hassle of couriering his cheques to the home branch each and every time or contacting the dwelling branch, every time he has a difficulty or a query. So it helps if the HFC is well networked across the country.
5. Prepayment / Foreclosure added benefits
For many individuals, this plays a considerable role in their selection to go in for a certain HFC. For example, a lot of salaried individuals know for a reality that their salaries would be revised each and every year. This indicates that they can pay a higher EMI going forward. Some of these individuals also know that they would be getting a bonus, which they can utilise to pay off their home loan (either completely or partly). Some banks do not charge people for producing a prepayment / foreclosing their account. Definitely such HFCs should really get preference more than other HFCs that do levy a prepayment charge.
six. Do your homework
Several folks have a tendency to get into ‘brands’ rather than going for what suits them greatest. It really is not about how major the brand is it is additional about irrespective of whether that brand suits your specifications and satisfies your criteria. Make a list of your specifications first and then dwelling in on an HFC. Speak to men and women who have currently taken a loan from a distinct HFC and get their feedback.
Other variables like documentation, processing costs, document storage facilities and time taken for processing the loan ought to also be regarded as. For instance, people do not like it if the documentation is an irksome process or if the processing costs are exorbitant.
Apart from this, study all the terms and circumstances meticulously and do not neglect to take an professional tips. Hence, instead of reading on the lucrative delivers of the firm, it is crucial to read and understand the technical elements of the presents. So if you want to be in a win-win proposition even though dealing with the Housing Finance Business, the onus is on reading the fine print in the loan document and seeing by way of the maze of thrilling offers.