Avoid committing the same mistake twice

Home loan refinance has presented a far more convenient way for the borrowers that are not satisfied with their present lender or with the loan scheme that they have opted for. The borrowers that messed up while judging a lender have a chance to rectify their mistake and to ensure that they are not paying any extra penny.

It is very common thing for the borrowers to land in an unfavorable deal, it is not a thing to resent, one just needs to work out the situation and he would be out of it in no time. All one needs to do is to find a borrower that is willing to offer lower interest rates and that suits the requirements of the borrower the best.

Before finalizing a deal with the other lender, a borrower must make sure that he will not have to encounter the same problems that he has been facing with his present lender that ways the new deal will be of no use and the efforts will result in vain only.

So, a borrower must try and not to repeat the mistakes that he had committed while making the earlier deal and he must make sure that time he gets what he has been looking for. It is imperative that he is aware of the terms and conditions and there are no or minimum hidden costs associated with the loan, he must tweak as much as he can.

Some borrowers make the mistake of judging a home loan scheme solely on the basis of interest rates that is a very wrong conception. Lenders formulate the loan scheme that makes the loan product much more attractive then it really is. So it becomes very important to follow the implication of the loan products that he wants to borrow.

Enjoy extra benefits with Joint Home Loans

The continuous hike in the lending rates has been terrorizing the borrowers, the lending rates have been soaring since the last couple of years and hence it has had an advert effect on the financial planning of the borrowers.

A borrower can not do much to regulate the lending rates so in order to save as much as they can out of the unfavorable conditions like these, borrowers are opting for advanced loan schemes where they can get much more benefits then the conventional loan schemes and hence to an extent can counter the effect of high lending rates; one of such kind are the joint Home Loans.

In such home loans two individuals co-borrow a home loan; it is the best option for the working couples. From the borrowers point of view it is a multi benefit loan scheme, one that their loan eligibility increases and two they can enjoy more income tax benefits.

"Under section 80C of the I-T Act, deduction from total income is available to the extent of .`1,00,000 in respect of any payment, re-payment, part payment and/or installment, towards the cost of purchase/construction of a new residential house property to any bank, financial institutions, etc," said Suresh Surana, founder of Astute Consulting Group.

The amount of EMIs to be depends on the ownership of the borrower in the property, inn case the ownership proportion changes then the EMI pattern for the co-borrowers also changes accordingly.

Reverse Mortgage Scheme, bliss for senior citizens

For the people that have entered second innings of their life and does not have any primary source of income and yet they do not want to be a burden on anybody; reverse mortgage scheme is the best way out, the only condition that implies is that they must have a place of residence.

Reverse mortgage scheme is meant for the people that are above 60 years hand have a primary place of residence. The best thing about such loans is that considering the age of the applicants the loans procedure is very lenient and the loans are kept at high priority due to which the loan gets sanctioned in no time.

Under reverse mortgage scheme, lender pays the borrower a definite amount after a definite interval so that a borrower can meet his necessary requirements. It depends on the borrower whether he requires lump sum of money or if he wants to be paid on the monthly basis. The best part here is that the borrower can enjoy the benefits of the loan scheme while he is staying his house.

The idea here is that the lender decides the value of the property according to the market rates at time of borrowing and a borrower can opt from various options available to him to customize his loan. The loan amount will be due only if the borrower dies or he moves out of the property.

In that condition the lender will sell the property and will recover the loan amount due and in case the property fetches more amount then what the lenders is entitled to then the rest of the amount is transferred to the heirs of the applicant.

This scheme is not suitable for the people that do not want to give away their property as the lender will ultimately sell the property to recover the loan amount. The other thing that needs to be considered is that if a borrower moves out of the property immediately the amount that the lender has paid becomes due.

To tackle soaring rates go for prepayment

Sometime back the hike in the property rates was the primary concern for the buyers but now the soaring interest rate on the home loans also is not leaving any stone unturned to exploit the home loan borrower. The people that were planning to borrow home loan have a option of wait and watch but what can a present borrower do, except shelling out his hard earned money.

For the borrowers that are devastated by the soaring interest rates, prepayment can be a very good option. Depending on his capacity and the resources available a borrower can either prepay the whole loan amount or he can for partial prepayments.

While doing that a few things are to be kept in mind that when a borrower prepays his loan, the lenders levy prepayment penalty on his that is decided in accordance to the loan amount and loan tenure remaining and it can also vary from bank to bank; generally it is high for private sector lenders but if a borrower is making partial prepayments then the lenders do not charge anything.

But if a borrower is prepaying by his own resources and is not borrowing any money from any other lender to prepay the loan borrowed from the present lender then also lenders can not charge anything extra from the borrower.

Is a person wants to prepay his loan and does not have any extra source of income then he can make use of recurring deposit scheme. At present a person can earn around 6 percent from this scheme, by the time a borrower has accumulated a considerable amount of money he can utilize that for prepaying his loan.

Due to the prepayment the principal amount will decrease considerably and hence the amount interest will be charged will decrease resulting in decrease in the amount of EMI to be paid.

Home loans for NRIs

A nice home is what every one requires including. A lot of people living outside the country also want to own a house in their own country but they sometimes find it difficult to give a concrete shape to their dream. It can be due to several reasons but most of the times it is due to the monetary issues, home loans for NRIs is a very suitable option for such people.

A lot of the banks provide home loans to the NRIs, the schemes that they offer can vary to a great extent. So it on the customer to do some research and decide which loan scheme will suit him the best. Before finalizing a deal with a lender it is better to get every details related to the loan and get every aspect of the loan cleared, so that one can get the most of his loan.

Eligibility is rather a ver6y important tissue here, an applicant must be above 21 years of age, he must have a valid Indian passport and the documents that validates that he is employed abroad. The lenders not only provides loan to purchase a new home but one can also avail a home for home improvement loans.

It is very important that the applicant follows the application procedure properly and keeps the all the documents required ready as it will make the process swift other wise it can be very tedious. Also, a borrower must ensure that the information he is providing is correct as if at any point the lender discover t hat the details are not authentic then he can cancel the loan application at that instant itself.

Precautions necessary for best deal

There is whole lot of lenders available in the market willing to lend to the borrowers at easy and attractive conditions but the point that must be considered here is whether a loan scheme can suit to everybody’s requirements. The answer is no.

Sometimes a borrower might find it difficult to resist to the glittery home loan schemes but these attractive loan schemes can also cause inconvenience to the borrower at later stages of the loan. So it is very necessary for a borrower to go for cautious home loan reviews.

Apart from that a borrower must be clear about his requirements and expectations. It will help the borrower to narrow the search ambit and therefore will increase the probability to get away with a more favorable loan scheme.

Self evaluation of the borrowing capacity is another aspect of towards a hassle free approval of home loan. Sometimes people selects a property on which no ban k is willing to lend then loans as the property value exceeds the borrowing capacity of the customer. Self evaluation can come handy in these cases.

Home loans even for people from lower income group

Home loans are no doubt very hefty in nature and are generally for a long term, it is a very difficult decision even for a middle class salaried individual to opt for a home loan considering this one can easily say that home loans are next to impossible for a person from lower income group like those working as domestic staff.

One might be shocked to know but there are lenders that have started offering home loans even to the people falling in the lower income group. Lenders like Micro Housing Finance Corp. Ltd (MHFC), a Mumbai-based lender, Aadhar Housing Finance Pvt. Ltd, GRUH Finance Ltd and SEWA Bank offers home loans to such people and even assist them to borrow the loan.

Private sector lender, YES Bank is also going to launch a similar facility on pilot basis in Mumbai. The lenders have a list of projects that they are financing making it easier for the borrowers to select for a home that fits in to their budget and suits their requirements.

They also require doing paperwork like filling up the application form apart from it they also need to have identity proof, address proof, PAN card, family status and source of income. The lender will then confirm the authenticity by calling the employer.

The borrower needs to submit at least 20% of the loan amount as margin, they can avail maximum of Rs. 7 Lakh as home loan for a maximum duration of 15 years but the interest rate applicable is slightly more than that in market; it ranges between 12-14 percent, another advantage is that there is no prepayment penalty involved

A person that has a long association with his domestic staff can guide him to get a home of his own.

A few things to care about in home loans

It is a dream of everyone to have a home of his own but the dreams of various people had to suffer major set back due to the aberrant hike in the interest rates during past few years. It is almost impossible for a person in present condition to buy a home exclusively from his own savings; here the home loans have proved to be a real savior for such people.

Home loans are a very convenient option to own a home but due to the complex nature of home loans sometimes a borrower can fund himself stuck amidst deep trouble. So, a borrower needs to be very cautious not only during the whole loan application procedure but he also needs to keep a vigil on each and every aspect of loan even after the loan has been sanctioned.

To start with a customer requires evaluating himself according to the norms set by the lender, also he require to make sure that while applying for the loan he has supplied the lender with all the documents that were asked. Such act ensures hassle free movement of the loan application.

Then the other important thing is the home loan amount that a borrower can avail. Generally the lenders sanctions 80-85% of the total worth of property as home loan the loan, rest a borrower needs to arrange by himself. Also the credit score is of vital importance, a customer with good credit score can avail extra benefits on his home loan.