It is usually stated that shopping for a dream house requires enormous expenditure for most of the investors. Some individuals invest a extended period of time, garnering their savings to fulfil this dream, even though other individuals opt to take a loan (credit) to fulfill this dream.
Possessing done your self assessment about the repayment capacity, location of your dream property, amenities and other fancies that you would like your dream household to have. It’s time for some serious exercise of choosing your HFC.
Selecting a HFC demands intense care and proper consideration, and for that reason following the under-talked about pointer will make this physical exercise easier. Past record of such institutions ought to be properly checked as it will be a long term connection involving you and institution. Make sure that the complete process does not finish up becoming a complete day headache or nightmare for you, therefore prudent measures although deciding upon the financer.
1. Rate of interest
This is exactly where it all begins. Though the price of interest provided by most HFCs is a lot more or significantly less the same on paper, some degree of bargaining in most cases, leads to a lowering of rates by as a great deal as .25 to .50 percentage points. More so if your profile takes place to match the requirement of the HFC. The lowering of interest rate has a substantial influence over the lengthy term even though the distinction is not so noticeable more than the near term. For instance, a .50% interest rate ‘concession’ on an Rs 1,000, 000 loans more than 20-year tenure will decrease your liability by upto Rs 72,000. But care wants to be taken to guarantee that the distinction is not getting offset elsewhere by the HFC beneath the guise of other ‘charges’.
A single ought to also be careful about teaser rate offer you, as they are sometimes definitely teasing. They advantage you for a short-term – say couple of years (till the fixed interest price tenure), but later as floating rate starts applying they dig a bigger hole on your wallet.
2. Calculation of the exact household loan amount
Right here, HFCs differ in their calculation of the loan quantity to be disbursed. Some HFCs calculate the quantity to be disbursed on the basis of, say, the gross salary although some HFCs calculate it on the net salary. This may well make a difference to folks as the loan amount and the EMI will vary across HFCs. 1 requirements to look into this and get a comparative analysis completed across HFCs, to recognize which HFC presents the ideal deal. Also one need to verify no matter if the HFC is supplying pre-EMI and tranche based EMI repayment alternative. This will enable 1 whilst taking loan for an under construction home, as this provides them an option to pay interest only on the portion of the loan disbursed or to select the instalments they want to pay, till the time the property is ready for possession.
3. Just after-sales service
And you thought right after-sales service was synonymous only with customer durables! No – it applies to virtually everything, and so also applies to HFCs. In fact, it is quite important even though deciding upon an HFC. An HFC can differentiate itself with superb soon after sales. Take the example of post-dated cheques (PDCs). It is general practice to give 36 PDCs throughout the time the loan is disbursed. It is right after 36 months are over that following-sales will play a function. How diligent are the HFC’s follow-ups? Are they prompt? Are reminders timely? In addition, for the duration of the financial year-end, the HFC must be punctual in giving the borrower interest paid certificate (elements of interest and principal amount paid in the economic year) so that he can file the needed documents for availing tax positive aspects (beneath section 24b and 80C of the Income Tax Act) on residence loans.
four. National presence
The HFC should be present across the nation or at least have branches in all important metros and towns. This delivers an person an much easier accessibility. This assumes importance if the existing job of an person is of a transferable nature (e.g. bank job, defence personnel) or if he needs to make long and frequent outstation visits (e.g. consultants, businessmen). The individual should not be place through the hassle of couriering his cheques to the house branch each time or contacting the house branch, each and every time he has a difficulty or a query. So it assists if the HFC is well networked across the country.
5. Prepayment / Foreclosure benefits
For quite a few men and women, this plays a significant function in their selection to go in for a unique HFC. For example, numerous salaried people know for a reality that their salaries would be revised every year. This indicates that they can spend a greater EMI going forward. Some of these individuals also know that they would be finding a bonus, which they can utilise to pay off their home loan (either totally or partly). Some banks do not charge folks for creating a prepayment / foreclosing their account. Certainly such HFCs really should get preference over other HFCs that do levy a prepayment charge.
six. Do your homework
Many individuals have a tendency to get into ‘brands’ rather than going for what suits them greatest. It really is not about how significant the brand is it is far more about irrespective of whether that brand suits your requirements and satisfies your criteria. Make Macropay Scam of your needs 1st and then property in on an HFC. Speak to folks who have currently taken a loan from a unique HFC and get their feedback.
Other aspects like documentation, processing charges, document storage facilities and time taken for processing the loan must also be viewed as. For instance, people do not like it if the documentation is an irksome process or if the processing charges are exorbitant.
Apart from this, read all the terms and conditions carefully and do not forget to take an specialist advice. For that reason, as an alternative of reading on the lucrative provides of the enterprise, it is essential to read and realize the technical aspects of the provides. So if you want to be in a win-win proposition while dealing with the Housing Finance Company, the onus is on reading the fine print in the loan document and seeing through the maze of thrilling offers.