Buying a house is undoubtedly one of the biggest financial decisions to take in life. And the availability of Home Loans has made this process straightforward. What made this process even smooth is the convenience of applying Home Loans online.
So, you can now easily access this financing option and get the funds you need without any hassle.
Now let’s discuss the benefits of applying for a Home Loan.
Benefits of Applying for a Home Loan
People with dreams of having their own home should not stop themselves from working for it. Home Loans allow you to buy or renovate a house without using your funds except for a small down payment. Also, there are different types of Home Loans like property loans, home renovation loans, home construction loans, plot loans, etc., which not only help you purchase a new home or land but also assist you in renovating or extending your old home.
Nevertheless, here are the benefits of applying for a Home Loan.
One of the most notable benefits of Home Loan apply online is tax benefits. Tax benefits are the tax deduction that the government of India provides to encourage more people to buy their houses. If you apply for a Home Loan, you can claim a tax deduction of up to Rs 1.5 lakhs in a financial year on repayment of the Home Loan principal under Section 80C of the Income Tax Act of India.
Moreover, a tax deduction of up to Rs 2 lakhs is permitted on the interest payment of the loan under Section 24B of the Income Tax of India Act. However, you can only claim the tax deduction after the property is completely constructed.
Balance Transfer Facility
A balance transfer facility is another significant advantage that comes with Home Loans. A Home Loan is a long-term financial commitment. During the tenure, if you are not satisfied with the frequent changes in the terms and conditions of the lender, interest rates, and customer services, you can always switch to a new lender with your outstanding value. The new lender will clear your existing loan by paying the balance money, and you can start afresh by paying your EMIs to your new lender at a lower interest rate with better services.
Zero Prepayment Charges
If you are planning to take a Home Loan, it will be wise to prefer a floating interest rate. Unlike fixed interest rates, floating interest rates have no prepayment penalties. Therefore, whenever you have excess money, you can use it to pay your loan partially, lowering your burden.
Longer Repayment Tenure
Applying for a Home Loan in present times comes with many benefits, including a longer repayment tenure. It can go up to 30 years. Therefore, you can reduce your EMI by extending your tenure. You can also use the Home Loan EMI calculator to check the changes in tenure by changing the instalment amount. This way, you can reduce your EMI, but your debt repayment will remain for a longer period.
Attractive Rates of Interest
Home Loans come with interest rates that are more attractive and competitive than any other loan. As a result, it does not put a lot of burden on your planned finances. You can apply for a Home Loan online to make the application process smooth.
Increases your loan eligibility
You can increase your loan eligibility by repaying your Home Loan in time. Paying and managing a substantial debt like a Home Loan in time will improve your credit score. A good credit score will make you more eligible to take further loans.
The Application Process for a Home Loan
To avail of a Home Loan, there is a step-by-step process that you must follow.
- Fill out the application form with your personal details and submit it to your lender. Make sure to put all of your details correctly and accordingly.
- Availing of a Home Loan requires documents like age proof, address proof, identity proof (Aadhaar card/Voter ID card/PAN card/Passport), income certificate, pay slip of last six months, business evidence for self-employed individuals, etc. You need to attach the required documents with your application form.
- Processing fees may be required depending on the lender. This processing fee may differ across lenders.
- The lender will verify your property papers along with all the required documents you have attached and give you a sanction letter. Later the loan will get disbursed after the verification process.
Or else you can also apply for your Home Loan online. You must choose your preferred bank or financial institution and visit their website. You will find an application form where you have to put all your details and attach copies of the required documents.
Home Loans can be very beneficial when you decide to buy a house or renovate your existing home. However, you must research before applying for a Home Loan to avoid the risks that may fall upon you in the future. You need to check all the terms and conditions, the interest rate you are settling for, and the loan tenure before applying to understand your loan and manage your finances better.