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Is A House Loan A Good Investment Option?
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A house loan is usually considered as a liability. It is a long term loan and many believe it to be a financial burden. The requirement to pay EMIs each month as a part of repayment process can be stressful for an individual. However, there are many benefits of opting for a house loan. The first is that the loan allows individuals to afford the house of their dreams without having to clean out their savings. A house loan is also considered to be a good investment for individuals, the reason being:
Long term benefits
In the long term perspective, using a home loan to purchase a house of your dreams is extremely beneficial. The price of renting an apartment in India is extremely high even if the size is relatively small. A house loan allows one to purchase the house of their choice. The payment of EMIs each month may be higher than the amount one may spend on rent however at the end of the tenure of the loan; one has the house to their name. Hence for those who are planning to settle down in a city, a house loan is an extremely good investment option.
Real estate prices
The real estate prices in major cities such as Mumbai, Bangalore, Delhi and Calcutta is extremely high. Thus both renting and even purchasing a house tends to be an expensive ordeal. However, opting for a home loan, not only does an individual at the end of the tenure own their own apartment but with the increasing real estate prices they can either sell it or rent it and earn a profit.
The reason why a house loan helps an individual is that it provides the finances one requires to purchase the house of their dreams. Many believe that such a loan puts a serious amount of pressure financially on an individual to pay back the loan on time. Failure to do so can force the bank to seize the house and resell it to get back the loan amount. But what such a loan does help in is preserving the individual’s savings. It is crucial to do so, so that one can have money in the case of any emergency.
Opting for a house loan provides a number of benefits for the borrower. As long as one plans their finances and pays their EMIs on time, they should not have to worry about their loan. It is an extremely good investment as long as one ensures that they have researched on the home loan and its benefits.
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