Planning to take a home loan? Here’s how to choose a good lender
Now that you’ve set your heart on your dream home, you would be looking to finance it. Well, it’s a good decision; the only thing that remains is finding a good home loan provider. When you start searching for a financer, you should realize that there are a number of options to choose from, and picking up the right one is a little confusing. But don’t worry, this article will give you a few tips to choose the right lender and ensure you get the best home loan.
Reputation and reviews
You should always check the reputation and reviews of the company or bank where you will apply for home loans in India. Comparing a few good banks or firms is better than comparing a bunch of lenders. Therefore, visit the aggregator sites to read customer reviews, expert blogs, and forums. It will help you choose the best home loans in the town.
The principal amount
It’s the money that lenders will allow you to buy your dream home. Most banks or finance companies will offer you between 80 and 90 percent of the property’s value towards the loan amount. You can use an online calculator do decide your home loan EMIs.
The interest rate
After the principal amount, choosing the best home loan will depend on the interest rates you’re offered. Leading banks and finance companies provide a loan with an interest rate varying between 8.35 to 9 percent. Look for home loan lenders that give you maximum loan amount at least interest rates. Also, look for a company that gives you the option of fixed, floating or semi-fixed floating interest rates. You can choose one that suits your needs.
Processing charge and prepayment charge
The best home loans are the ones that have the least amount of processing charges on your housing loan. Typically, you can expect a processing charge as low as 0.25% or as high as 2%. Prepaying a loan is always a good thing, as it will reduce your debts, it’s better to do it as soon as possible. However, some banks and finance companies incur a prepayment charge if you decide to pay-up before the specific tenure. Look for the ones with zero prepayment charge or low charge.
A good housing finance company will provide easy and minimum documentation process. Once you submit the documents; a good company will quickly go through your request and sanction it. So, when you’re looking for the best home loans, make sure the loan providers you select will provide these features.
If you keep these parameters in mind, you can pick the best home loans in India. It is advisable; you can speak to the loan officer or a home loan expert, as they would be able to clear your doubts in minds, regarding terms and conditions, policies, interest outgo, principal amount and more.