Home Loan for New customers

Nowadays, to buy a home of dreams is not an easy path to go ahead because of rising prices all over India. Home loan is an effortless way for a person to make the dream come true. 

There is a need of some amount as down payment of home just 20% of it.  The left over amount can be paid through home loan depending on the eligibility criteria. These home loans can be paid back to the bank through equated monthly installments (EMI) for the tenure period of the loan. Some part of EMI is for principal component to pay back and other for interest. As a person keep on paying the EMI the principal amount is reduced, then the interest component goes down and principal component increases.

 The bank offers two types of interest rate that is, fixed interest rate and floating interest rate.

Home loan interest rates will remain constant throughout the tenure period. Some banks have a reset clause of changing the interest rate after a fixed period ranging from 3-5years. Floating interest rates varies with the fluctuation in the market. The interest rate can be increased or decreased.

The second type of home loan is floating interest rate. It means the person has to give interest rates according to the market. Whenever the bank will change their base rate simultaneously the interest rate will get change. The change will be on EMI or tenure period. Whenever bank increases their bank rate, the EMI will increase. Thus, floating interest rates are more preferable than fixed interest rate.

Home loan provided by the banks depends on the credit history of the person. If the credit history is good then, the person will easily get the home loan at the best rates. If the credit score of a person is poor then, the person can get a home loan at the lowest interest rates. A person can easily apply online sitting at home without any hassle. All the information is present on the internet. A person will choose the home loan on the basis of interest rates, which vary from bank to bank. To apply for the home loan the necessary documents required are identity proof, employment proof, age proof, income proof, salary slips and bank statements. After the submission of the documents, bank verifies the documents. Once verification completed, bank approves the loan and money gets disbursed into the borrower account.