Looking to purchase a home? But, don’t have the necessary funds for it? Check out the top five types of housing finance available in India and pick one that meets your requirements.
In India, nothing spells contentment and success like, “Owning a home to call one’s own.” In fact, buying a home is the biggest dream for most Indians.
However, with burgeoning real-estate prices, buying a home is proving to be a difficult task. Spending your entire life savings or emptying your retirement fund on a property isn’t a sensible decision. This is where home loans come in.
Home Loans – The Bridge Connecting You to your Dream Home
Taking a home loan is one of the easiest ways to fund your dream property. Today, several financial institutions offer various types of housing finance to cater to the needs of different types of people.
Let’s take a look at the top five types of home loans available in India.
1.New home purchase loans
This is the most commonly available home loan in the country. Using this loan, you can fund the purchase of a new ready-to-move-in home unit, a resale home or an under-construction property. The amount sanctioned by this type of loan varies depending on the borrower’s earning potential and repayment capacity and can range anywhere from 2 lakhs to 2 crore.
Generally, the maximum tenure of a new home loan is twenty years for self-employed and thirty years for salaried professionals. The borrower can choose the required tenure based on his/her preferences.
- You must submit collateral to avail a home loan.
- Financial institutions provide funding up to 90% of the market value of the property.
- You can avail tax deductions for both the principal and the interest you pay. The principal amount is deductible under section 80C and interest amount is deductible under section 24 of the Income Tax Act.
2. Home Improvement Loans
Looking to renovate or add extensions to your property? Then, you can apply for a home improvement loan. As the name suggests, this loan provides funding for home enhancements like roof/flooring repair, painting, kitchen modernization, home extension, bathroom fittings, garden improvement and so on.
A home is a symbol of your status and pride. Therefore, it’s essential to keep it in top-notch condition without letting it fall into a state of repair and disarray. Make quality improvements to your home without any hassles using a home improvement loan.
- All the owners of a property must be applicants to get the home improvement loan approved.
- The deeds of the property and other ownership details must be submitted at the time of application.
- Even if your home renovation is hampered or stopped, in the case of an accident like a fire or a natural calamity like a flood, you still have to repay the loan.
3. Swaraj Home Loans
This home loan is offered exclusively for first-time home buyers. It caters to a vast community of first-time home buyers who may or may not have the necessary income proof documents.
4. Balance Transfer
Not getting the best deal at your current home loan lender? Is Inefficient processing by your home loan provider causing a big headache? Worry not, you can easily transfer the remaining home loan to a new provider who offers you better interest rates and simplifies the process.
You can opt for Balance Transfer and move your home loan from your old lender to a new one.. Instead, of staying with your old lender and paying huge interest rates, switch to a new provider
- No evaluation charges for collateral
- You can claim Tax benefits & pay a lesser processing fee
- Helps you save big in the long run
5. NRI Home Loans
As the name suggests, this home loan is offered exclusively for NRIs to buy property in India. Wherever you’re in the world, you can now purchase a home in your motherland and come back to your roots whenever needed.
- You can avail loans only to buy residential properties
- The property must be situated with municipal limits
- It cannot be an agricultural land
Make your home dreams come true by choosing the right home loan that works for you.