Buying a house, as deep-seated a wish as it may be, might not be particularly easy for the common man. This is especially true for metropolitan cities that usually entail a higher cost of living as well as increased property prices.
However, the mistake that many commit is approach a lender with a shaky cognizance of property, home loan related matters and an attitude hinting at partial or complete surrender to any diktat the lender finds fit to issue.
But times have changed now with more number of financial institutions coming up with attractive, independent offers in a bid to lure customers. Hence, it is much easier now to make an informed decision about a home loan and make sure that you are on the top of things.
This list of the 5 most important questions that you should ask your lender before taking a home loan will ensure that you don’t pay high interest rates and also benefit from the features that fit well into your scheme of things:
Will you consider any statutory expense?
You can start by asking if your lender is willing to cover statutory expenses such as registration charges, stamp duty or any other miscellaneous fees. Generally, a home loan is approved only by taking in to account the real cost of the property. However, few banks and institutions can consider such charges, albeit only under special schemes.
Will my insurance policy act as collateral?
Sometimes, banks may not fully disclose the ways by which you can increase your eligibility. There is no reason to lose hope if you are told that you don’t meet their eligibility criteria. Depending on the discretion of the lender, your insurance policies could be adjudged collateral against an increased loan value.
Will a change in interest rate affect my payout?
That every lender, to get you enrolled in their account books, will offer the most competitive rates of interest on a home loan is a fact. Considering a fixed rate, the amount you’d have to repay at the end of the tenor will be subject to the interest that was decided during the disbursal of the loan. On the contrary, the loan amount is determined by the prevailing rate (at the time of repayment) if you go with a floating interest rate.
Do you allow a balance transfer?
Financial crises can dishevel your budget and make loan repayment a difficult. Remember that existing high interest rates and stiff loan tenures will only compound your problems. It is then that the loan balance transfer becomes absolutely vital to take cover from both. So, ask well in advance about the lender’s policies on loan refinancing.
What if I band the home loan with other financial products?
Don’t forget to slide in this question when you are having a talk with the lender’s representative. Often, it could be a deal maker if you have other ongoing financial services such as an FD account from the same financial institution that you approached for a home loan. Ask them if they are willing to enhance your eligibility to avail a revised loan that meets your criteria.
Only the rate of interest is given primacy while zeroing-in on a lender for availing a home loan. Truth is there are other factors that you should take up and discuss with your lender before you proceed with the deal.
You can also check out all the pre-approved offers on home loans, personal loans and business loans from Bajaj Finserv to avail finance hassle-free.
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