Major Factors You Should know that affects your Home Loan Interest Rates

It is the dream of so many people to either or building a home of their choice. In the event of funds shortage, the facility of home loans has emerged as a viable solution. 

As per your eligibility and other factors, you can avail of a significant amount. But since it comes with a longer tenor, the home loan interest rate charges are on the higher side. 

On that note, it would be good to look at a few factors affecting home loan interest rates. 

1. Your CIBIL score 

Your CIBIL score affects your payable home loan interest rates. It is the mirror of your creditworthiness and hamper’s the faith of your lender in loan repayments. If your credit score is lower, you may not get the loan approval. Even if you do, you may have to pay higher housing loan interest rates. If your CIBIL score is higher, you can get approval at a lower housing loan interest rate. You should work towards maintaining a credit score of 750 or more. 

2. Your home loan value 

The higher is your home loan price, the more you will have to pay as home loan interest rates charges. Hence, if you don’t need a large property, you can opt for smart home and pay lower interest charges. 

3. Your loan tenor 

While it’s good to pay a smaller EMI per month over a longer home loan tenor, it also means repaying higher interest charges. Therefore, you should try to opt for a shorter tenor and save on home loan interest charges. Yes, your home loan EMI may increase over a smaller tenor, but there will be considerable interest savings. 

Since you have an idea about factors affecting your home loan interest rates, you can implement the same and save more on repayments.