In a country like India, where having own home is one of the dreams of every individual, the development in the real estate industry has been a boon. People in India are driven to buy properties by the home loans available with the help of the banks. Because of this facility people can afford to invest in personal homes without depending on the hard cash in hand. As the home loans play a crucial role in enhancing the real estate sector, the buyers and the developers depend on home loans to progress and step ahead in the process of property buying and building respectively.
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Most of us feel that we cannot avail this facility of home loans for any other purpose but buying a new home. However, this does not stand true. A person can opt for home loans for various other purposes like renovation of home, construction of a new home, etc. Still, there are certain norms that are applicable to individual options, but this does provide an advantage to the buyer to opt for a home loan for any of these purposes. The banks lend an amount between 75-80% of the contract value while the buyer needs to arrange the remaining amount. The rate of interest applicable to the amount taken on loan also changes from time to time, relying upon the parameters like economy growth and liquidity in the market.
Home loan can be obtained by fulfilling the required parameters such as employment status, duration of current employment, personal income and credits existing if any. Out of all these parameters the most important is the credit history of the person applying for the loan as that needs to be documented if there is any credit history from any of the other financial institutions. They also consider if there are any other loans existing, the type and age of property, including the complete transparency in the stated purchase.
Some of the banks also recommend insurance policies to protect the home loan. This gives assurance to the banks that they will be able to retain the money lent to the borrower in case of loss of life of the borrower or any other reason for inability to repay the loan. However, the loan provided to the borrower is extended over a period of time. This might sound little difficult for the first time borrowers, but is not that difficult in reality. For borrowers the main obstacle exists in finding the best mode of repayment of the loan to the bank in certain duration or period of time. So if you are thinking of opting for a home loan, all you need to do is lookout for the best deal to get a home loan with your most suitable way of repayment of the loan that should not burden you with the time factor during repayment.
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