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Factors To Consider When Applying For A Home Loan

By Author: Aishwarya Mahurkar
Total Articles: 291

Home loans are a type of secured loan which banks provide to applicants to help one afford purchasing an apartment or a house. The real estate prices are extremely high making it difficult for an individual to afford their dream home on their own. A home loan provides one with the funds they require to afford that dream house. Banks now also provide home loan EMI calculators to help borrowers know their EMI in a few seconds. But before you apply to any bank for a home loan there are certain factors you need to consider:

1. Down payment

When you are submitting your application for a home loan, you will be required to provide all the important documents about the house or apartment you wish to purchase. No bank will provide you the entire value cost of the home loan as a loan. You will be required to put down a certain percentage of the amount as down payment. This can range from 10 to 20 percent. Hence it is important for every applicant to be able to afford the bank’s down payment expectations.

2. Income stability

Banks will only be willing to provide a home loan to an applicant who holds a steady job. Hence it is important for you to ensure you have a steady job. A stable source of income proves the bank that you can be relied on to repay the EMI on time every month. You can also combine another family member’s income with your own in the application to help boost the chances of your home loan being accepted. You can always use a home loan EMI calculator to help plan your finances better.

3. Credit history

Banks always check an applicant’s credit history when considering an application. An applicant’s credit history includes their payment patterns, their past and current loans and any past defaults in repayment of loans. These statements help a bank understand your spending pattern and also if you are reliable enough to repay your loan consistently each month. A bank may reject your home loan application if you are already in debt. So it is advisable to pay off any pending loans before applying for a new one.

4. Type of home loan

There are a variety of schemes and offers available for applicants when it comes to applying for a home loan. If possible, try to obtain the advice of a financial specialist before applying for any type of home loan. This will help you choose the one that meets your requirements perfectly. Sometimes depending on the type of home loan, the interest rate charges may vary. If you are still confused, banks also provide home loan EMI calculators with which you can find out which type of home loan is more affordable for you.

These are a few factors every home loan applicant must be aware of before applying for a home loan to any bank.

Author Bio :

The author is a seasoned writer on finance topics and through her writing; she articulates aspects of home loan that are important to people availing the home loan facility. She writes about a variety of topics covering the home loan documents, rates, home loan EMI calculator that help to make the best decision.

Total Views: 91Word Count: 533See All articles From Author

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