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Written by Site Administrator
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Tuesday, 27 October 2009 16:30 |
You can maximize the home loan amount for which you are eligible by following the steps listed below:
1. A brand new property does not have any depreciation on it. So the bank’s assessment of the loan amount for such property is very close to the market value. Try to select a new property to get higher loan amount.
2. Not all banks pay registration charges. Apply for a loan with a bank that includes registration charges as well. This way, you can increase the loan amount easily by 1 or 2 lakhs.
3. You must always try to select a property whose value is likely to close to or a bit greater than the amount for which you are eligible based on your salary, etc. This way, you can get maximum amount as loan.
4. You can increase your eligible loan amount by adding a salaried co-applicant. Only spouse or a child is allowed (in case of child, he/she should be the only child).
5. You can increase your eligible loan amount by declaring your alternate sources of income, such as income generating assets, private business, etc.
6. You can also maximize the loan amount by a direct interaction with the loan evaluator from the bank who is going to evaluate your property. You can give them more details about the quality of the construction, the credibility of the developers, etc so that they do a favourable evaluation of your property.
7. You eligible loan amount will reduce if you have any other existing loans running on your account. For example, vehicle loan, personal loan etc. It is recommended that you pre close these loans well in advance before approaching for a personal loan.
8. Keeping a clean credit history will also help. If there are too many bounced checks showing in your bank statement, you will lose your repayment credibility. It is best to make sure that your checks don’t bounce and that you have adequate balance in your savings account for any automatic payments (ECS) you are liable to pay.
9. Wait for a salary hike before applying for a loan. You will get a higher loan amount if higher salary is being credited into your salary account.
10. Jump to a company where you can get a higher salary. This may sound like going a little too far, but it is true. At least 3 to 6 months before you plan to go for a home loan AND if you really desperately need a higher loan amount than consider shifting your job to an employer who can pay you much more than your existing salary. Make sure that the company is of good repute. This also counts for a home loan.
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Written by Site Administrator
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Tuesday, 27 October 2009 16:42 |
Basically, any individual who is domiciled in India and is above 21 years and below 65 years of age can be termed as eligible for applying for a home loan.
Additionally, there are conditions laid out based on which the banks will measure your credibility and your repayment capacity. These include that you must either be a salaried or self employed with a reasonable monthly income. NRIs and individuals with existing property who are willing to pledge their property as security for the loan may also be considered eligible to apply for a home loan.
Your eligibility for a home loan is only a mere prerequisite for applying and does not automatically mean that the loan will be sanctioned. The banks will assess your credit history, your bank statements, your tax receipts, your repayment capacity, and your stability in your career or in your business before approving your request for a home loan.
For example, your loan may not be sanctioned if you have too many bounced payments on checks, if you have been shifting your employer more frequently, etc.
For this reason, you must try and build your credibility in the first few years before applying for a home loan.
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Written by Site Administrator
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Tuesday, 27 October 2009 16:52 |
Depending on various factors such as your existing costs of living, number of dependants, existing loans, and your ability to comfortable repay the loan in the desired tenure, the bank will be able to give you 40 to 50 times your salary (Cost to Company). The bank will study your bank statements, your credit history, your employment history, etc before arriving at this figure.
In the case of self employed business people, your profit margin stands as a benchmark for measuring how much loan you can get for your home.
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Written by Site Administrator
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Tuesday, 27 October 2009 17:18 |
Banks levy additional fees at various levels during the process of your home loan. Not all banks have all the charges. Some of the charges are also negotiable.
Processing Fees
Banks will charge a intial processing fee of Rs. 2500 to Rs. 5000 (varies from bank to bank). This amount allows the bank to meet their expenses for processing your home loan application.
Commitment charges
Banks may charge a commitment charge which is certain percent of the loan sanctioned if you have not availed the loan for a period of more than six months after it has been sanctioned on your name.
Initial interest charges
This is the interest amount you pay for the no. of days between the date when the cheque is issued and the date from which the loan account becomes activated (generally the date when you avail the home loan).
Prepayment penalty
Prepayment is not allowed during the first one year of the home loan. From the second year onwards you are allowed to pay a portion of the remaning principal amount as prepayment. However, such payments may attract a penalty of upto 2% of the total loan sanctioned. Not all banks levy these charges. There are additional rules for deciding these charges. It is better to consult your banker and plan your prepayments accordingly so that you can avoid paying these additional charges.
Registration and Stamp Duty
These are charges that you pay to the Municipal and registration authorities for registering your house and are not levied by the bank. Some banks offer you this amount as a package along with your home loan. You may have to check with your banker to find out if these charges are included in your home loan amount.
Miscellaneous charges
Some banks these days are also providing brokerage services to make their service and end-to-end package. Once you decide to buy a house you can directly approach the bank and their agents will pick and review houses suitable for your in your preferred budget. In this event, they may charge miscellaneous fees for this service as well.
Brokerage charges
If you are buying your property through a broker, the broker you may have to pay the broker his brokerage charges, usually 1 to 2 % of the property value.
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Written by Site Administrator
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Tuesday, 27 October 2009 17:20 |
Some banks may offer incentives on your home loan. You will have to find out from your banker before you apply. Some the incentives include
- Free Accident Insurance
- Free Property Insurance or property insurance amount may be added to your home loan for free, that is, you need not apply for it separately.
- Waiving of Pre payment charges
- Additional Loan at a later stage for repairs and renovation
- Discounts on additonal loans later based on your repayment history
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Home Loan
