To Do-list for Availing Home Loan at Lowest Interest Rates

Home loans are unsecured debts that come with a lower rate of interest. 

Still, since it is a long-term obligation, many people pay extra interest charges. 

But it is possible to opt for a lowest home loan interest rate after following a few handy tips. Read on!

Here’s how you can enjoy lower home loan interest rates

1. Begin with a higher down payment

The first thing you can do to lower your home loan interest rates is by putting down a higher down payment. You will have to arrange at least 15-20% of your home value as the down payment. No lender approves a full amount. The moment you put a bigger down payment, you end up borrowing less. In turn, it helps you bring down your home loan interest rate charges as well. 

2. Opt for a shorter tenor 

Even though housing loans come with a longer tenor, it means you paying more as interest charges. You can save on interest charges by opting for a smaller tenor. Yes, your home loan EMI amount may increase if you do that. But you will be able to pocket savings on home loan interest rates. 

3. Go for a home loan balance transfer

If you are still unable to bring down your home loan interest rate charges, you can go for a home loan balance transfer. The facility helps you transfer your home loan account from an existing lender to one offering a reduced rate. If the charges of making the switch is higher are than your savings, you should not do it. Many lenders let you avail of a higher top up loan when you switch your home loan accounts to them. The rate of interest and the loan tenor may also be almost similar or a bit more than home loans. 

If you can follow these discussed tips, availing of a reduced home loan interest rate and enjoying savings on repayments may be so easy. 

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Things to be Noted Before Applying for a Home Loan

 Are you willing to apply for a housing loan and move or construct your dream home? 

If yes, the first thing is to meet your lender’s eligibility conditions. 

Many people don’t consider a few factors before applying for a home loan and suffer. 

Let’s check out a few aspects that you need to note while apply for home loan in this post!

1. Maintain a higher CIBIL score

If your CIBIL score is robust, nothing can stop you from getting the housing loan approval for a large amount. You can also do that at a lower rate of interest and pay reduced EMIs. Hence, you should ensure having a strong credit score. You can do that by paying your existing loan and other EMIs on time. A credit score of 750 and more will be considered ideal by renowned lenders to sanction your loan application fast.

2. Compare all available offers online

While applying for a housing loan, you will come across many deals, making you confused. Hence, you should always make it a point to compare all available deals on a third-party website. This way, you can pick an offer that meets your needs and budget the most. 

3. Check out your lender’s eligibility norms  

The lender you want to apply for the housing loan has eligibility norms mentioned on their website. Thus, you can check out all and prepare in advance. It is also good to use the home loan calculator like the eligibility calculator online. Using it, you can know an amount that you can get. You can also know about an amount that you will pay as the EMI, along with current home loan interest rate charges. 

By considering these disused aspects, you can easily approach your home loan application better and enjoy a quick approval.    

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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.  

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Avail Home Loan Subsidy Under PMAY Yojana 2021

 If you are building or buying your first-ever pucca home in India and want to do that using a housing loan, you can save on interest charges. It is because you can avail of a home loan subsidy of up to Rs.2.67 lakh on home loans. 

It will be as per your income categories of Economically Weaker Section (EWS), Lower Income Group (LIG), and Middle Income Groups 1 and 2. The facility is available under the Pradhan Mantri Awas Yojana (PMAY) of the Central Government of India. 

Let’s know how much subsidy can you enjoy when you apply for a home loan under PMAY’s credit linked subsidy scheme (CLSS)!

The breakup of subsidy on home loan under PMAY

1. EWS 

Applicants belonging to the EWS category should earn a maximum yearly income of up to Rs.3 lakh with a maximum home loan of up to Rs.6 lakh. With a loan tenor of up to 20 years, the carpet area of the home should be 30 sq mt. They can get a 6.5% subsidy on interest per year, amounting to a maximum of Rs.2.67 lakh. 

2. LIG 

For LIG housing loan applicants, their income should be between Rs.3 lakh and Rs.6 lakh. The max carpet area should be 60 sq mt and a home loan of up to Rs.6 lakh. The loan duration is a maximum of 20 years, with subsidy on interest being 6.5% per year to the tune of up to Rs.2.67 lakh. 

3. MIG 1 

MIG 1 applicants are those who earn an annual income between Rs.6-12 lakh. They are allowed a carpet area of 90 sq mt and a maximum home loan of up to Rs.9 lakh. The loan tenor is for 20 years, with interest subsidy being 4%, amounting up to Rs.2.35 lakh. 

4. MIG 2

For MIG 2 candidates, the yearly income should be between Rs.12-18 lakh, with the max carpet area being 110 sq mt. The maximum housing loan is up to Rs.12 lakh with a tenor of 20 years. They can enjoy a subsidy of up to 3% to the tune of up to Rs.2.3 lakh. 

You can check out your PMAY eligibility and start making the most of PMAY benefits. This way, you can pocket subsidy on home loan interest charges.  

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Home Loan Digital Sanction Letter within a few minutes with Bajaj Housing Finance Limited

Were you looking to apply for a home loan to buy your dream home? If yes, you may like to settle for a bank like many more. 

But applying for a home loan with a conventional letter may take more time for approval and more. 

But if you opt for the Bajaj Housing Finance Digital Sanction Letter within a few minutes with Bajaj Housing Finance Limited, you may get the digital sanction letter instantly. Want to know more? Read on!

What is a home loan digital sanction letter instantly?

The Bajaj Housing Finance Limited is a subsidiary of Bajaj Finance Limited, a known non-banking finance company (NBFC) in India. 

The leading housing finance company has recently announced a revision in home loan approval time. 

Anyone fulfilling the home loan eligibility criteria can get a digital sanction for an e-home loan within a few minutes. 

The biggest benefit of applying for a Bajaj Housing Finance home loan will be expediting the process of availing finance for a property. 

In turn, eligible borrowers will be able to save on time and efforts and complete the housing loan process over a smaller duration.  

With instant approval available, it can help borrowers streamline the entire home buying procedure. Once you have received the digital sanction letter for the Bajaj Housing Finance home loan, it stands valid for 6 months.

If you wish to make the most of the Bajaj Housing Finance home loan sanction letter, you can first meet the lender’s eligibility. To do that, you can land on the Bajaj Housing Finance Limited website and access the home loan calculator. 

If your CIBIL score is higher, you have been consistently employed or have a business vintage of at least 5 years; you can avail of lowest home loan interest rates. It can assist you to save huge on repayments.  

Also Read: 5 Important Factors You Need to Know About Home Loan Incentives

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Home Loan Digital Sanction Letter within a few minutes with Bajaj Housing Finance Limited

 Were you looking to apply for a home loan to buy your dream home? If yes, you may like to settle for a bank like many more. 

But applying for a home loan with a conventional letter may take more time for approval and more. 

But if you opt for the Bajaj Housing Finance home loan, you may get the digital sanction letter instantly. Want to know more? Read on!

What is a home loan digital sanction letter instantly?

The Bajaj Housing Finance Limited is a subsidiary of Bajaj Finance Limited, a known non-banking finance company (NBFC) in India. 

The leading housing finance company has recently announced a revision in home loan approval time. 

Anyone fulfilling the home loan eligibility criteria can get a digital sanction for an e-home loan within a few minutes. 

The biggest benefit of applying for a Bajaj Housing Finance home loan will be expediting the process of availing finance for a property. 

In turn, eligible borrowers will be able to save on time and efforts and complete the housing loan process over a smaller duration.  

With instant approval available, it can help borrowers streamline the entire home buying procedure. Once you have received the digital sanction letter for the Bajaj Housing Finance home loan, it stands valid for 6 months.

If you wish to make the most of the Bajaj Housing Finance home loan sanction letter, you can first meet the lender’s eligibility. To do that, you can land on the Bajaj Housing Finance Limited website and access the home loan calculator. 

If your CIBIL score is higher, you have been consistently employed or have a business vintage of at least 5 years; you can avail of lowest home loan interest rates. It can assist you to save huge on repayments. 

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Best Time to Refinance Your Home Loan: A Complete Guide

Home loans come with remarkably long repayment tenors, ranging from 15-20 years. Such an extended period can entail several changes in one’s financial position and make it increasingly difficult for borrowers to chalk out an effective loan management plan.

Consequently, repayment difficulties, plus reductions in home loan rates as seen now, prompt many borrowers to seek refinancing. However, individuals need to time their home loan transfer depending on the following factors to ensure optimum savings.

• Changes in financial position: Unprecedented circumstances leading to an increase or decrease in income is very common. Borrowers can choose balance transfer if their current lender is unwilling to adjust the home loan EMI terms to facilitate ease of repayment. 

• Lower interest rates: One of the most prominent reasons for individuals to choose housing loan refinancing is a decrease in interest rates. Several financial institutions refuse to lower the floating interest rates of existing loans upon a repo rate cut. In such cases, borrowers can switch to a lender offering lower rates. A loan transfer can also be helpful if you are willing to switch from high fixed rates to lower floating rates.

• High outstanding and tenor: Interest component of home loan EMI decreases over time, with each EMI payment. Thus, seeking home loan transfer is a wise option only during the early years, preferably the first quarter of your tenor, since it ensures maximum interest savings.

Note that irregular EMI payment history with your current lender can lead to poor home loan eligibility and might deter a refinancer from approving your application. 

Also, make sure the total cost of refinancing, including processing fees, transfer charges, valuation fee, etc., does not exceed your anticipated interest savings. Stay updated with the latest regimes for home loan tax benefits to enhance the interest savings availed through a balance transfer.

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Top Benefits and Uses of Home Loan EMI Calculator

 Securing a lump-sum credit to purchase your dream house might sound appealing. However, it might not be a convenient choice if not planned efficiently. These large sums are accompanied by substantial interest components and can result in hefty repayments. Defaulting on an instalment due to financial constraints in the course of a loan can negatively impact a borrower’s credit score. Using an EMI calculator before applying can help individuals plan their repayments more effectively.

Following are some significant ways in which an EMI calculator can benefit potential borrowers.

1. Accuracy and speed: EMI calculation involves a complicated procedure, and manual computation can result in discrepancies. Using a home loan EMI calculator provides accurate results within just a few seconds.

2. Effective financial management: An EMI calculator displays the total payable amount, EMI and the interest component separately. Individuals can adjust their inputs until these results match their home loan eligibility and affordability. Picking a suitable tenor and loan amount can aid in smooth repayment.

3. Comparison: Since interest rates vary across lending institutions, using an EMI calculator can help users compare monthly repayments under different lenders easily.

4. Free and easy: Home loan calculators are available on almost all financial institutions’ websites, free of cost. They are also easy to use. Individuals only need to enter 3 inputs to get the results.

Potential borrowers can enter the following details to view their payment breakup.

• Required principal amount

• Interest rate

• Preferred tenor

Note that a longer tenor might result in smaller home loan EMI payments but will lead to increased interest cost in the long run. Conversely, if you can compromise your luxuries for higher EMIs, choose a shorter tenor and save remarkably on interest payments.

Also, be aware of home loan tax benefits under the tax regime you have opted for, new or old.

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Amazing Tips to Reduce Your EMIs on High paying Home Loan

Are you paying a higher home loan EMIs affecting your outlays? 

A home loan is a long-term obligation that helps a considerable amount to buy or build a new home. 

But if you are managing higher housing loan EMI, you don’t have to worry. It is because it is possible to reduce home loan EMI by following a few tips. 

Read on this quick post!

1. Go for a higher down payment 

When you apply for home loans, you will not get the entire value of your new home as the loan amount. The maximum you can get is 75-80%. The rest has to be arranged on your own and known as the down payment amount. Hence, if you put down more than the regular amount, you will need to borrow less. A lower borrowing amount means you can reduce home loan EMIs considerably. 

2. Make regular part prepayments 

If you already have an active home loan account, you can still reduce home loan EMI. It is by making time-to-time part prepayments. You should do that during your initial loan tenor so that you can pay off a large interest amount. Before doing that, you should check if your lender charges any amount for making part prepayments. 

3. Opt for a home loan balance transfer

If you see a really good offer from a lender providing you with a lower rate of interest, you should switch your loan account to it. This facility is known as the home loan balance transfer. This way, you can bring down your EMI amount and also save on interest charges. 

Other than these tips, you can also go for Pradhan Mantri Awas Yojana (PMAY) if you are buying or building your first-ever pucca home. 

It can help you pay reduced EMIs because you can get an interest subsidy on home loans up to Rs.2.67 lakh as per your eligibility.

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Follow These Easy Steps to Reduce Your Home Loan EMI in 2021

The process to compare different lenders and opting for the lowest interest rates is inevitably the modus operandi of most borrowers while availing a home loan. In order to help prospective borrowers out, most financial institutions offer a home loan EMI calculator where one can check the EMI payable beforehand and check if the same matches his/her repayment capacity. 

In case you think that the Equated Monthly Instalments will put severe stress on your budget, consider following the below-mentioned options to reduce your EMI. 

• Negotiate home loan interest rates: Since this factor directly impacts your loan EMI, it is important to negotiate and choose the right interest rate to facilitate easy repayment. In this case, borrowers availing the loan on floating interest rates automatically benefit from the reduction in market rates. 

• Opt for a longer loan tenor: Even though opting for a lengthy tenor increases your total interest outgo, it also reduces the home loan EMI. It is wise to make use of the online home loan EMI calculator to find a suitable loan tenor that makes your repayment process convenient. 

• Pay more as a down payment: Consider making a hefty down payment as it can reduce the amount availed as loan, and consequently the EMI as well. Also, paying a higher amount as a down payment not only reduces your EMI but also ensures fast approval.

• Choose home loan balance transfer: In the case of existing borrowers, a home loan balance transfer is a great way to reduce your monthly financial burden. Find out which lending institution is offering the lowest interest rate at that moment and transfer your loan. 

Both the rate of interest and loan tenor play significant roles in home loan EMI reduction; therefore, it is wise to pay attention to the factors associated with them. Consider comparing different deals offered by financial institutions and use the home loan EMI calculator to plan your repayment at the very onset.

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