When you are planning to buy a new car or a home or other expensive things, it is imperative to arrange finances. There are many lenders and banks that offer lucrative deals to people. The deals such as low-interest rates, flexible repayment, charging less or zero processing fees, discounts offer, add and free gifts like AC and TV, etc., are offered. One can avail of one of the best home loans to lower borrowing costs, such as the PNB home loan. Let us understand all these details on the home loan here.
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About Home Loan
To buy a home, one of the best options available is to apply for a home loan. This will cater to your financial needs, and you can buy a house for yourself.
First, however, you must pay the loan back by paying EMI or monthly instalments to the lender.
The EMI amount includes the principal amount of the loan and the interest rate charged by the lender.
Most banks and NBFCs provide home loans at competitive interest rates.
Types of Home Loan Offers
The lenders may offer different home loan offers for salaried and self-employed individuals:
1) Low-interest rate: Many lenders lower the home loan interest rate by 0.5% to 1%. Due to the low-interest rate, paying less Equal Monthly Instalment, the individual can save cost.
2) Slashed processing fees: Banks often slash the processing fees on home loans to make them more lucrative. However, it can help to lower your overall home loan cost.
3) No Pre-payment charges: The lenders often charge a fee when the borrower pays the loan before the end of tenure. Under an offer, these charges might be waived.
4) The low number of EMIs: The borrower may get an EMI waiver, under which they can save the EMI amount for some months.
Different banks offer different deals on home loans.
For example, in festival times, SBI reduces the home loan interest by 0.15%, HDFC Bank and ICICI Bank offer interest rates of only 8.10%, Bank of Baroda offers loans at 7.95%, and more.
Some of the housing loan lenders like PNB home loan offers attractive home loan offers. You may be able to lower the cost of a home loan with their best home loan offers.
Documents Needed for Home Loan
Documents are an essential thing when you look forward to availing a home loan. Therefore, you need to submit all the required documents carefully. These documents are necessary for the verification of the loan.
Here is the list of documents needed:
- Home loan application form
- A few passport-size photographs
- One of the Identity proofs such as an Aadhar card, Voter card, Pan card, Passport, DL or driving license
- One of the address proofs such as an Aadhar card, Passport, Voter ID card, DL, utility bills like electricity bill, water bill, telephone bill, etc.
- Financial proofs such as the last six months’ bank statement, salary statement, ITR or income tax returns in the case of a salaried individual and financial proofs needed for self-employed individuals are the bank statements of the past few months, P and L or Profit and Loss statement, ITR or income tax returns. For self-employed individuals, Challans are also accepted as proof of Advance Income Tax payment.
- All the asked property documents such as property purchase agreement, certificate of property possession, receipts of advance payment for the house, house allotment letter from the society, approved building plan, non-encumbrance certificate, NOC or No Objection Certificate, Power of attorney, etc.
How to Apply for a Home Loan?
Availing of a home loan is relatively easy. The process of applying for a home loan varies with the vendor. To apply for a home loan, here are the following steps:
- First, go to the lender’s website.
- Open the home loan page.
- Enter the home loan amount you need.
- Next, you must enter your contact details, such as your mobile number.
- Next, tick the box of terms and conditions.
- Next, go through the home loan details such as interest rate, etc.
- Finally, enter the OTP or One Time Password and get more information on your registered phone number.
- You also need to mention imperative information such as your gender, location, shortlisted property details, email address, marital status, employment details, etc.
- You will receive a call from the home loan executive.
Wrapping up
Many different financial institutions offer home loans to facilitate and support the needs of the borrowers. They offer loans at discounted rates too. You should apply for a home loan to buy your dream home. Do not forget to research well and assess the things like the amount you will be able to afford as EMI conveniently, different interest rates charged by different lenders, other deals and discounts offered by the lenders, your own assets and liabilities, and a lot more. You need to be wary of all these details to pay your loan back.
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I think for the past many years, almost all (more than 99%) the housing loans are on “floating rate” basis only which means that there is no “pre-payment charges” applicable.