Your Home Loan Tool Kit

When you want to buy a home, it involves spending several weeks and even months scouting for the most appropriate property. You also need to figure out the best deal to procure housing finance. Borrowing from a financial institution to buy a home is a big decision. You will be repaying the borrowed amount through Equated Monthly Installments (EMIs) for a very long period of time. Therefore, it is important that you take the time to research different options and understand various terms and conditions before making this long-term commitment. Several online tools are available, which help you find the best deal while looking for a home loan. Here are some online calculators that are helpful:

  1. Your home loan eligibility primarily depends on certain factors. These include your age, educational qualification, employment, assets, spouse’s income, and your existing liabilities. Most financial institutions offer a loan amount wherein the EMI will be between 40% and 50% of your monthly income. However, eligibility differs from one lender to another and it is recommended you check the same before making your decision.
  2. An online home loan EMI calculator is helpful to know the approximate EMI you will have to pay each month. You need to enter certain details such as the loan amount, rate of interest, duration, and processing fees. These calculators are an easy and quick way to know the potential EMI to help you make an informed decision.Here are the various components that you need to know to ensure you maximize the benefits of the home loan eligibility calculator and the EMI calculator:
    1. Borrowed amount Before applying for a housing loan, you need to know the amount you will have to borrow in order to buy your desired property. Based on the total price of the home, you will have to calculate the down payment. You need to pay this amount from your personal resources before the lender disburses the loan. It is important you know this figure accurately to enable you to determine an accurate EMI.
    2. Loan duration You will also have to choose the loan duration based on your regular monthly installments and other existing installments on outstanding loans. You need to understand that although the EMI for longer duration is lower, you will pay a higher amount due to additional interest. You may choose different durations to check the EMI using the calculator to determine the one that suits your financial situation and allows you to service the loan without any liquidity crises.
    3. Rate of interest After determining the loan amount and tenure, you must input the prospective rate of interest charged by the lender. At Indiabulls Home Loans, we have a variable interest rate ranging from 8.80% to 11% depending on the loan amount. We levy a processing fee of up to INR 10,000 for home loans up to INR 150 lakh, 0.50% for loans above between INR 150 lakh.
    4. Repayment options At Indiabulls Home Loans, we offer different repayment options to ensure you do not have any financial difficulties in servicing the loan. We offer EMI holiday where the payments commence. Alternatively, you may increase your EMI with a rise in your income. As you near retirement, your income may decrease and you may opt for the Flexible Loan Investment Plan (FLIP) to repay the outstanding amount. You may also choose to prepay the loan before the end of its tenure and save on the overall interest cost.

Applying for a housing loan online is easy and quick. However, to ensure your application is not rejected, it is recommended you use the various online tools to determine your eligibility and other factors.

1 Comment on "Your Home Loan Tool Kit"

  1. Thanks for providing the useful information on Home Loan EMI Calculation. However Could you please clear what is the definition of Net Monthly Income.Is it take home salary ( after deduction of Tax, PF etc ) or Gross salary.Also if the reimbursements if any will be included in the salary or not.The Home loan EMI Calculator does not give any chart showing the month payment of Principal and Interest over the period of Loan.

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