Who doesn’t want a place they can call home? Home is where the heart is, isn’t it?
Well here are a few essentials you should keep in mind before you buy your safe haven.
1). Pre Approval: The first and most essential element you must keep in mind before you finalize on a flat, is to know whether you are eligible for a loan and the amount of loan you are eligible for. This amount is usually 60 times your monthly net income. For example if you’re monthly net income is Rs. 40,000/-, you will be eligible for a loan amount of Rs. 24,000,00/-. Therefore try looking for a house around this figure. However if you’re married you could take a joint loan, which will be higher because the net monthly income of you and your spouse will be merged and taken as one. Make sure you get a pre approval from the bank before looking for a house.
2). Check for hidden charges: The cheapest is not always the best. Many a times banks reduce the rate of interest on loans to make it look more attractive. Look for hidden charges that banks won’t disclose at the outset such as the processing fees, legal fees, administrative fees etc. We have spoken about these hidden costs in detail in another blog you must definitely give a read to. Speak to the banks you have shortlisted and find out all the costs before hand and add it up. Then go about selecting the best bank.
3). Research: Today there are several online portals to assist you in finding your dream home. Type in your budget (in accordance with the loan amount you are entitled to), location preference and housing type and you will be presented with several houses that suit your requirement. Make sure you do a background check on the builder before you make your selection. Spend some quality time on research. It will surely be worth the effort.
4). Location: Before you buy your dream flat, be sure to check the accessibility of the area you’ve chosen. You rather pay a little more and buy a flat, which is accessible, than spend more on transportation staying away from important landmarks. Also make sure you don’t finalize on a flat in a low-lying area. It would get easily flooded during the monsoons. Factor in the location of the house before you select your dream home.
5). Equated Monthly Instalments (EMI): It is the amount payable by the borrower to the lender on a specific date every month. Your EMI will depend upon the duration of the loan. Ask your bank for your EMI on the home loan. Now check whether you will be able to manage that payment every month. However if the EMI is eating a huge sum of your monthly income, ask the bank to increase the duration of the loan and reduce your EMI. This will help you make
the payments in future without any worry. If your EMI’s are still looking too high, you can decide to wait a while or look for other affordable options available.
Once you have done the above successfully you are all set to take the big step. Just remember one thing. Don’t hurry. This is a long term investment, so take your time and invest smartly.