Will Shifting Home Loan to Repo Linked Loan Reduce EMI?

 The home loan is a unique funding option that lets you get the required amount to buy your own home. 

However, the home loan is a long-term commitment. And it demands adequate planning from borrowers so that the repayment happens easily. 

Before and after availing the home loan, borrowers resort to various ways to repay lower house loan EMI. They do that so that they are able to save enough to meet other monetary needs. 

By going for a longer tenure, maintaining a robust cibil score and going for the home loan balance transfer, they lower the EMIs. 

But many borrowers think if shifting their home loan to repo linked loan will reduce their housing loan EMIs or not. Read on and explore now!

If you have an ongoing home loan account, then you can get your housing loan linked to the repo rate. In this regard, the home loan interest rate may not reduce considerably. But the loan that is linked to the repo rate is considered more transparent in passing on the changes of the interest rate to the borrower. In earlier debts, the entire benefit of the lowering of the interest rate by the Reserve Bank of India (RBI) was not given to borrowers. And the portion of it was also pocketed by the financial institutes. If you want to go with this option, then you should enquire with your current lender only. This facility may be less cumbersome in terms of paperwork and logistics. You should ask your lender with a rate that they are offering to new applicants. Analyze it lower than your existing one and if it is the housing loan low interest rate in the end, then you should go for it. 

Overall, if you want to shift your home loan to repo linked loan, it may help you reduce your housing loan EMIs.   

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Myths to Ignore While Getting a Home Loan

Many people may have the required eligibility to apply for the home loan, but they still don’t apply for it. 

Other than facing different issues, they also don’t do that owing to some home loan myths. 

Let’s check them out in today’s post so that you can ignore them and apply for the housing finance confidently!

1. Shorter loan tenure is good 

Yes, when you avail shorter loan tenure, then it means saving on the home loan interest rates. But you also need to understand that it means paying a bigger loan EMI amount that may affect your outlays. It can leave little scope to concentrate on other outlays. 

2. Good cibil score comes with the loan approval 

Yes, the cibil score is one of the key factors while determining the home loan eligibility of the applicant. If it is higher, then you may get the loan approval. But factors like your income, age, job stability, employer credential, property location also matter.

3. Home loan rates are not negotiable 

You may still believe that home loan interest rates are not negotiable. But this is far from true! If you are not satisfied by the home loan rates by lenders, then you can always negotiate for a lower rate. Having a good cibil score, repayment and employment history may help you get an affordable rate of interest. 

4. Lenders levy heavy penalties for making prepayments and foreclosure

Another myth doing the round is that if you make prepayments and foreclose the loan earlier than the tenure, then you need to pay exorbitant charges. It is not true! Lenders are not supposed to charge any amount on floating rate loans. For fixed rate based housing loans, your lenders may ask for some money. It may vary from one lender to another. 

You are now aware of the leading home loan myths that you can now ignore and apply for a home loan with confidence. If you are ready, then you can now apply for the housing loan by comparing different loan offers online. This way, you can pick the best deal matching your needs and repayment capacities.   

Must Read: Home Loan EMI: 6 Ways You Can Reduce It Easily

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Know What is top up on a Home Loan

 Have you ever wondered what the top up loan is? If you are carrying the home loan balance transfer, then you can meet your multiple needs with top-up loans. 

The top-up loan is a financial facility that is given to borrowers opting for the loan balance transfer. If you want to know about top-up loan, then this post is for you!

What is the home top-up loan?

If you want to switch your home loan account from one lender to another offering a lower rate, then it is called the home loan balance transfer. Leading lenders reward you with the top-up loan when you switch your home loan to them. If you have been repaying your home loan EMIs on time, then you can avail the top-up loan facility. 

What are the benefits of the top-up loan?

When you have an active home loan account and if you have some other financial needs to fulfil, then you can cater to all with the top-up loan. The benefits of a top-up loan are many. Take a look: 

• The top-up loan’s documentation process is simple and the loan approval time is less time-consuming. 

• The disbursement for the top-up loan is fast. 

• The rate of interest for the top-up loan is affordable and is almost the same as that of the housing loan rate. 

• You are free to use the top-up loan amount for anything as per your needs. Be it the debt consolidation loan, marriages, home improvements, business expansions and more, you are free to use the top-up loan money for anything. 

• There is no need to submit any collateral for availing the top-up loan. It is because the loan is linked with your home loan profile only. 

Depending on the lender that you apply for top up loan with, you can get higher or the higher top-up loan amount.   

Read Also: Top Five Things to Check about Home Loan Balance Transfer

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How You Can Make a Vis-à-Vis Evaluation of Plots & Houses?

Quite often, people get stuck while deciding whether they should invest in a plot or a house. It is a general tendency to evaluate the benefits of the property based on its current price. For instance, the difference between the price of a 2 BHK flat in Provident Kenworth, Hyderabad and a same-size plot in the same locality is Rs. 8-10 lakhs. This figure does not help in drawing an inference regarding the profitability of the two options.

To avoid any kind of ambiguity, it is suggested that buyers evaluate what they can and are ready to invest. Considering the same locality and same dimensions, the amount of money that is required to buy a plot is comparatively lower than that of a ready-to-move-in house. However, the cost of buying a plot and constructing a house will be invariably higher than the cost of buying a house or a flat.

The land is a scarce resource, and its value is bound to increase. Plus, the plot does not undergo any depreciation. Thus, the value of land is expected to appreciate rapidly. The resale value of a house depends upon its location and age. An apartment in a posh location will have a high resale value. But a sufficiently old house will be valued after deducting the depreciation costs.

While determining whether to buy a plot or a house, one should also take into consideration the expected returns. If you want to get regular returns in the form of rental income, then buying an independent house is the fitter option. Plots can generate rental income only after the construction of a house, which will comprise a significant time lag and further investment.

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Top Reasons that Make Bangalore a Prudent Option for Realty Investments

Bangalore, popularly known as the Silicon Valley of India, is augmenting the effects of growing IT developments, trade, commerce, startups, social infrastructure, online and digital businesses in the town. This unprecedented growth has trickled down and spread across various sectors in the city.

One of the several outcomes of this economic expansion is the swelling demand for residential and commercial properties in Bangalore. Apart from its self-expansion, there are some other reasons which make the real estate market of Bangalore one of the best investment avenues in India.

A huge chunk of the software engineers of the country is working in Bangalore. To add to this, the opening of many startups in the city has further augmented the employment opportunities in the city. Consequently, there has been a constant rise in demand for affordable housing in Bangalore. There are many residential projects like Sobha Lake Garden which can meet such demands perfectly.

Furthermore, owning a 1 or 2BHK flat in Bangalore can provide significant rental income as every year there is a massive influx of workforce from other parts of the country. The city is undergoing rapid infrastructural advancements. Quality public transport, great connectivity, good higher education, prestigious research institutes, and advanced healthcare, further adds up to the USP of the place.

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Why You Should Buy Property In 2019?

The demand for affordable housing has always been a consistent aspect of the real estate industry. What has evolved as a striking feature in recent years, is the rise in demand for the land or plots, especially at a time when apart from affordable housing, all other units of real estate sector were showing a sluggish trend.

Careful consideration of both the options is essential to arrive at a decision which is both pragmatic and beneficial. The first thing that one should consider is the cost of buying a plot/flat and to what extent the buyer can invest or arrange funds.

It is also important to consider the potential or expected value appreciation of the property. Considering the same location and dimensions, the increase in the value of the land will be higher and faster than a flat. However, in a space-crunched posh location, the value appreciation of a flat will be equally fast. Financial assistance is another relevant factor - it is easier to get loans for flats, as opposed to land.

Demand for rental housing options is prevalent in every Tier I and most of the Tier-II cities. For example, the sale of affordable flats in Pune has seen a tremendous increase in recent times. Projects like Shapoorji Pallonji Joyville are meeting the residential demands of the people with its range of amenities and has evolved as a prudent option for the investors and home-buyers alike.

Additional Read: How Investing in a Property a Good Idea?

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Some Tips For The One Who Are Looking To Buy Property In Bangalore!

Before you start hunting for properties, be certain about what your budget is. Take into consideration your current and future expenses, your monthly income and any ongoing loans or debts.

Also, before narrowing down on any property, it’s prudent to check that everything is done as per the Government regulations of the state as far as real estates are concerned. It is vital to verify that if the property has been built in compliance with the legalities or not. Even consulting with a lawyer is quite plausible in this regard. 

The next thing you need to do is make sure the location of the house you are interested in is well connected to the city. Research about the neighborhood, and what other developmental projects are ongoing nearby as those are bound to have an impact on your lifestyle sooner or later.

Must Read: Is it Worth to Buy a New House in Bangalore?

Check out all the amenities advertised, by the realtor, by visiting the site in person. A lot of times, advertisements are promising much more than what it is in reality. You need to be careful about these types of properties and steer clear of them.

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Challenges That You Have To Face While Looking for Affordable Property

Affordable Housing is widely gaining importance in all major cities of India. The Prestige High Fields located in Gachibowli is one of the most affordable houses for sale in Hyderabad. By buying flats in this housing project, you can automatically enjoy the best facilities at affordable rates.

The real estate sector, though, booming in India is fraught with many challenges. The land is becoming increasingly scarce in prime areas of most of the metropolitan cities. An unclear policy framework coupled with high fees and taxation, regulatory issues and corruption are restricting the much-desired projected growth of the real estate industry.

These handful problems are plaguing the real-estate sector and can be solved by implementing the regularised taxation system. Sustainable urbanization can remove many of the problems faced by the real sector. The focus should concentrate on improving connectivity and develop urban infrastructure such as creating new Metro rail, constructing highways, build mono-rail trains.

Must Read: How Investing in a Property a Good Idea?

Lack of access to financial services is another major hurdle faced by the homebuyers in India. Most of them do not possess the large capital required to purchase a house, and hence, refrain themselves from buying it due to inadequate financial solutions. However, with the introduction of favorable Government policies and coming forward of many NBFCs, the situation has improved drastically.

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Why NRIs Are Buying More Commercial Property In India?

Over the years, NRIs are increasingly investing in commercial properties in India. Also, many properties such as Pride World City are offering commercial spaces at a cost-effective price point. There are ample reasons why NRIs are heavily investing in commercial properties.

In the last few months, the value of the rupee has gone down as against dollar. This gives a good chance to NRIs earning in dollars to acquire more space at a lesser price. Be it booking flats in Pune or any other metro, NRIs can get a good deal.

Thanks to the implementation of policies such as RERA, the Indian real estate sector has become more transparent. Today, NRIs can track the progress of any project and builders can't take them for a toss. This has boosted their confidence manifold since they know every aspect of project development.

Must Read: Ultimate Property Buying Guide for NRIs in India

Also, the fact that the prices of commercial properties appreciate in the long run. So, should NRIs wish to sell their property in the near future, they can bag a profitable deal. This is another reason that has boosted the confidence of NRIs to invest in the country’s commercial realty sector.

Many firms in the country are on the lookout for commercial spaces for operations. If NRIs rent out a commercial property, it can become a source of secondary income for them.

Also, investing in a commercial property can secure an NRI's retirement. The rent earned from a commercial property can help NRIs to meet their post-retirement expenses and other needs. They can address various expenses once they hang up their boots.

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Navi Mumbai Or Thane: Which Place is Good for Your Investment?

Thane has an old-world charm and has established infrastructure for over 25 years. Navi Mumbai is a rapidly growing city and still has a long way to go. Both Thane and Navi Mumbai are serious contenders of each other as far as cleanliness is concerned. Improvements in roadways and railways are expected to ameliorate the transportation facilities.

Navi Mumbai is rapidly becoming an attractive real estate destination due to a large number of infrastructural projects. In contrast to Navi Mumbai, Thane offers a wide number of premium flats and cooperatives. Projects like Mahavir Kalpavruksha Thane offer a number of premium apartments at affordable costs.

When we compare the cost of living in both these cities, Navi Mumbai scores over Thane since it is relatively new. But with rapidly developing infrastructure, the property rates are expected to witness a good upsurge in Navi Mumbai as well as Thane.

Both Thane and Navi Mumbai have their own share of benefits when it comes to investing in property in areas slightly away from the main city. There are numerous facilities and attractive real estate projects for both these locations. Based on your financial health, location preference and requirements, you can decide which city you want to put your hard-earned money.

Additional Read: Best Real Estate Projects in Thane for Investment

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