What should you consider when taking out a home loan?
The loan amount also depends on the tenure and interest rate of the home loan. Apart from this, the upper limit of age for bank loans is also fixed.
Generally you take home loan for buying house/flat, plot or construction/renovation. Many times home loan is also taken to increase or repair the house. Here we are giving you all the necessary information about home loan.
How much loan can you take?
Before starting the home loan process, assess how much you earn and how much the bank can lend accordingly. Your ability to take a home loan depends on your repayment capacity. It depends on your monthly income, expenses and income of family members, assets, liabilities, stability in income.
Banks first check whether you will be able to repay the home loan on time or not. The more money you have in your hand every month, the more your home loan amount will increase. Usually, a bank or a lending company looks at whether you will be able to pay 50 percent of your monthly income as home loan installments or not.
The loan amount also depends on the tenure and interest rate of the home loan. Apart from this, banks also fix the upper age limit for home loans.
How much more home loan can you take?
A down payment of 10-20 percent of the price of a house or flat is required. This is your own contribution.
After this, a loan of 80-90 percent of the value of the property is available. It also includes charges like registration, transfer and stamp duty.
Even if the lending institution approves you for a larger amount as a home loan, it is not necessary that you take the entire amount as a loan.
While buying a property, you should make more down payment so that the loan burden is kept to a minimum. Keep in mind that the home loan lending bank charges you a lot of interest in the long term.
