Plan Your EMIs for Home Loan, Before Get One
Buying a Housing Property is a very big financial commitment on the personal front. Attractive and aggressive home loan schemes coupled with tax incentives has made it easier for younger people to invest in housing properties. Buying a Housing property and financing it through home loan has many benefits; however it requires a certain amount of financial planning on the individual’s part in order to make the process easier throughout the easy loan tenure. Before choosing the home loan you can compare online home loan rates and also check eligibility for Home loan through Home Loan Eligibility Calculator.
Trends of Interest Rates
The interest rates cycles have shrunk over the past couple of decades. We are seeing a lot of volatility and cyclic trends in the interest rates. Real estate, especially the home property market has seen a major shift in the last few years. The globalization has brought in many factors that influence the macro economy conditions in general which impacts the interest rates. Since home loan is a long term commitment, it is important to mentally prepare for cyclic trends in the lending rates and do financial planning to be able to pay higher interest rate during certain period of entire loan tenure based on market conditions.
Planning for Financial Commitments
A home loan is a very long term commitment with a payment tenure being more than 10 years in most cases. Therefore, it is important to think about other personal and financial commitments and chalk out a strategy to manage personal finances accordingly. People should also be careful while signing for attractive looking teaser home loan rates schemes which promise a lower interest rate during first few years and higher floating rates after a couple of years. These are some of the important aspects that borrowers should keep in mind while planning their financial aspects for purchasing a housing property.
It is important to create a financial cushion which can be utilised to fund any extra financial burden during certain periods. People can invest in equity or debt based investments based on their risk appetite. This accumulated fund can be used for the financial requirement to reduce the EMI burden in case of high interest rates periods.
It is important to carefully do due diligence in choosing your Housing Finance company, HFC becomes your long term partner and at times it is not so easy to change the HFC.
Since, Home loan is a long duration commitment, it is important to take some time and be a little selective about HFC. It can be helpful to take feedbacks, cross check the experience from friends, relatives etc about the past dealing of the HFC. It helps in understanding aspects regarding a Particular HFC. The Home Loan Insurance schemes are available through various Insurance Companies and they cover the home loan liability of an Individual. These Policies cover the home loan if something happens to the borrowers.
