When it comes to applying for a home loan, you need to pay interest rate charges. A longer tenor may lead to the payment of higher home loan interest charges.
Many people do not consider aspects that can affect their housing loan interest rate charges.
On that note, let’s check out a few factors that can affect your home loan interest rate!
Credit score
Credit score plays an important role when it comes to your finally offered housing loan interest rates. The higher it is, the lower is your home loan interest rate. Lenders reward you because you have paid your outstanding on time.
Interest rate types
Your home loan comes with fixed and floating types of rates. Floating rates are relatively lower than fixed ones. Hence, the type of your home loan also affects your housing loan interest rates.
Property location
Home loan interest rate varies as per the location of your property. If it is centrally located, lenders will offer a lower rate of interest. It is because they will find it easier to liquidate your property in case of defaults.
Loan tenor
A longer tenor means paying lower home loan EMI but more housing loan interest rate charges, and vice versa.
Your loan amount
The higher is your home loan amount; the more will be your payable housing loan interest.
Your income stability
If you are employed with an MNC, Public or a Private Limited Company for at least 3 years, you may enjoy a lower home loan interest rate. Hence, you should ensure to have consistent income stability. If you are earning without a break, the offered housing loan interest rate is lower.
These essential aspects may affect your home loan interest rate, and you must consider them when you have housing finance to apply.
