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The Various Benefits Of A Housing Loan

By Author: Aishwarya Mahurkar
Total Articles: 291

With a rise in real estate prices, purchasing the house or apartment of your dreams is extremely difficult. Many are not able to afford purchasing a house or apartment with their own salary and savings. In such cases, opting for housing loans is an ideal way to be able to afford your house. There are also a number of benefits for the individual who opts for a home loan.

1. Purchase the house of your dreams

The biggest benefit of opting for a housing loan is that it allows you to afford the house of your choice. Instead of using up all your hard earned money and only being able to afford a small apartment, a home loan gives you the opportunity to afford a larger house. It also allows you to save money since the loan prevents you from using up all your savings in one go. The loan will ensure that you have your savings in case of medical emergencies. Financial institutions ensure that the housing loan you opt for fits your needs and is highly beneficial to the borrower.

2. Affordable Loan

Financial institutions allow the applicant to choose the tenure and interest rate for their loan amount. If the housing loan applicant has a high credibility, they will be able to get a higher loan amount from the institution. To do so, one should take steps to improve their credit score by reducing the number of credit cards they own, reducing the monthly expenditure and avoiding defaults on past loans. A high credit score will make the financial institution be more willing to provide a higher loan amount.

3. Cheaper than renting a house

If you plan to live in a particular city for a longer duration, purchasing a house would be a better option as compared renting a house. Renting a house or an apartment for a long term basis can prove to be extremely expensive. Renting apartments in the city is expensive and unless you plan to move out of the city, this option is not cost effective. It is important for the individual to plan in advance to choose the most cost effective option.

4. Tax benefits

As per the Section 24(b) of the Income Tax Act of 1961, opting for a housing loan allows individuals to get a tax benefit when repaying the EMIs to the financial institution.

A housing loan provides a number of benefits to the borrower. It is a far more affordable option as compared to purchasing the house with your own money.

Author Bio :

Aishwarya Mahurkar is an experienced writer concerning the finance industry. Her articles help in informing her readers of the housing loan and the home loan process.

Total Views: 70Word Count: 443See All articles From Author

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