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Home loan is the sum of money a bank or financial institution lends you to help you buy your dream home. By taking a Home Loan from a bank or a housing finance company you pledge your home as the lender's security for repayment of your loan. The bank or financial institution will hold the title or deed to the property till the loan has been paid back with the interest due for it. Home loans are generally taken for long tenures as the loan amount is usually a huge sum. A Home Loan can be taken anywhere between 5 and 30 years. The amount of loan one is eligible for is dependent on the individual's credit profile.
f. Salaried Individuals:
You can take a Home Loan before or after identifying the property you want to purchase or when the property is under construction or for purchasing a plot of land for investment or to renovate an existing home.
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III.
Home Extension Loans: An extension loan is one which helps you to meet the expenses of any alteration to the existing building like extension/ modification of an existing home; for example addition of an extra room etc. One can avail of such a loan facility of a home extension loan, after obtaining the requisite approvals from the relevant municipal corporation.
IV.
Home Conversion Loans: This is available for those who have financed the present home with a home loan and wish to purchase and move to another home for which some extra funds are required. Through a home conversion loan, the existing loan is transferred to the new home including the extra amount required, eliminating the need for prepayment of the previous loan.
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Land Purchase Loans: This loan is available for purchase of land for both home construction or investment purposes.
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Stamp Duty Loans: This loan is sanctioned to pay the stamp duty amount that needs to be paid on the purchase of property.
VII.
Bridge Loans: Bridge Loans are designed for people who wish to sell the existing home and purchase another. The bridge loan helps finance the new home, until a buyer is found for the old home.
VIII.
Balance-Transfer Loans: Balance Transfer is the transfer of the balance of an existing home loan that you availed at a higher rate of interest (ROI) to either the same HFC or another HFC at the current ROI a lower rate of interest.
IX.
Re-finance Loans: Refinance loans are taken in case when a loan for your house from a HFI at a particular ROI you have taken drops over the years and you stand to lose. In such cases you may opt to swap your loan. This could be done from either the same HFI or another HFI at the current rates of interest, which is lower.
X.
This is tailored for the requirements of Non-Resident Indians who wish to build or buy a home or property in India. The HFCs offer attractive housing finance plans for NRI investors with suitable repayment options.
11. Can one take a home loan for construction in a city while working in another city?
Yes, you can take loan for construction in one city while working in another city. The HFC's generally service this loan after getting details of the plot legally verified.
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Your loan balance decreases as you pay each EMI and the amount of interest charged each month decreases as the loam balance decreases. The formula used by is:
13. What is the difference between fixed rate of interest and floating rate of interest?
A fixed interest rate remains constant throughout the loan tenure regardless of the market conditions whereas a floating interest rate can decrease or increase depending on market fluctuations. For instance, it increases when RBI hikes up short term interest rates. Banks usually quote the floating rate loans as their index rate (prime lending rate) plus or minus x%. Banks usually increase or decrease their prime lending rate when the RBI increases or decreases short term interest rates.
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What is EMI?
An equated monthly Installment (EMI) is the amount of money that is paid back to the lender on a monthly basis. It is essentially made up of two parts, the principal amount and the interest on the principal amount equally divided across each month in the loan tenure. The home loan EMI is always paid up to the bank or lender on a fixed date each month until the total amount due is paid up during the tenure. Find address of personal loan providers in $City name$ (the city name will be hyperlinked to the city page from bank locations displaying all the banks in that city)