Buying a house is a momentous occasion in ones life. It not only holds significant emotional value but also is a major financial decision. Nowadays, due to the increasing property prices, many individuals avail home loans for purchasing property. However, before applying for a home loan, you must consider different home loan lenders to find a home loan that best suits your needs. Choosing an ideal home loan lender could be tricky and confusing. However, some simple tips can help you do so. Continue reading.
Tips to Pick the Right Home Loan Lender:
- Check the Eligibility Criteria Set by the Lender
The home loan eligibility criteria may vary from one lender to another. However, the basic eligibility criteria of a home loan are your age, job stability, credit score, existing debt, etc. Try to settle for a lender with simple eligibility criteria as it will reduce the rejection chances of your home loan application. Also, it’s advisable to maintain a good credit score before applying for a home loan. This will not only boost your home loan eligibility but also help in availing a loan with better terms and conditions.
- Check the Interest Rate
The interest rate charged on home loan plays a pivotal role in determining your monthly instalments and the overall cost of borrowing. If the interest rates are high, your EMI would increase putting additional pressure on your budget. For example, if the Interest rate on home loan is 10.5%, your EMI would be Rs 49,919 for a loan value of Rs 50 lakh for a tenure of 20 years. However, if the home loan interest rate is 6.5%, your EMI would be Rs 37,279 for the same loan amount and tenure. Therefore, it’s advisable to consider home loan interest rates offered by different lenders before making the final decision. An attractive interest rate not only reduces the repayment burden but also helps you save a large amount in the long run.
- Documentation Process
A stringent documentation process can make availing a home loan a tedious task. The basic documents that you need to submit for a home loan are identity proof, address proof, income proof, etc. It is advisable to opt for a lender that processes your loan application with less documents. With us at Kotak Mahindra Bank, you can avail a home loan easily by uploading minimal documents online.
- Loan Amount
Before you apply for a home loan with a lender, check the loan amount you are eligible for. The loan amount you can avail would depend largely on your monthly income and the property’s value. It’s possible to avail a home loan up to 90% of the property’s value, provided you have a good credit score and high repayment capacity.
- Processing Fee and Prepayment Clauses
To process your home loan application, lenders usually charge a non-refundable fee that can range anywhere between 0.25% and 2% of the loan amount. Try to opt for a lender that has a low processing fee.
The prepayment facility allows borrowers to pay off their home loan before the specified tenure. However, lenders levy a prepayment penalty to compensate for the loss of interest income. The prepayment clauses and charges may differ from one lender to another. Thus, make a note of it while choosing your home loan lender.
- Turnaround Time
Buying a home is a big decision and can sometimes be overwhelming. During such times, the last thing you would want is a tiresome and complicated home loan process. Therefore, it’s advisable to opt for a lender that has an easy application and a quick loan disbursement process. With us at Kotak Mahindra Bank, you can avail a home loan from the comfort of your home that too within a short span of time. You can apply for a home loan online, upload all the documents and get quick approval.
- Customer Service
Always settle for a home loan lender with efficient and reliable customer support service. To get a fair idea of the lender’s credibility and authenticity, you can check online reviews or can speak to your friends or family who have already got the loan from the lender.
Make sure to keep the above-mentioned pointers in mind while availing a home loan. In case of any queries, you can talk to the home loan advisor from Kotak Mahindra bank and ensure that you make no mistakes in availing a home loan.