July 24, 2024

Affordable Home Loans: Finding the Best Rates and Deals

These days, home loans on WhatsApp have become a thing. There is no dearth of lenders in the market and therefore, borrowers have many different options to choose from. Thus, lenders are trying to better each other by providing customers with an inimitable home loan experience. 

Home loans on WhatsApp are a part of the efforts made by lenders in this direction. However, over convenience, borrowers must always give weightage to affordability. 

Home loans go on for decades and therefore, it is of utmost importance that one must avail themselves of affordable home loans. In this article, we discuss simple tips on how to avail themselves of an affordable home loan. 

Simple Tips on How to Avail Themselves of an Affordable Home Loan 

Do Thorough Research 

One of the most important things that you must do if you want to avail yourself of an affordable home loan is to do thorough research. Study the market, and see what different lenders are offering. 

Study the factors that affect home loan interest rates and then try and figure out what you can do to make yourself eligible for these rates. Finally, make a list of lenders you find to be trustworthy and reputable and reach out to them. 

Negotiate with each one of them for the best affordable home loan deal you can get.  In the end, use a home loan calculator to compare offers and go with the best offer extended by the best lender. 

Opt for a Home Loan Balance Transfer 

Home loan balance transfer is a facility using which home loan borrowers currently repaying a loan can transfer the remaining home loan balance to another lender if they find that this new lender is extending a loan offer that will help the borrower save on total interest payout and reduce the total cost of borrowing. 

However, a home loan balance transfer will most certainly draw balance transfer charges. Further, if you are on fixed interest rates, you may even be asked to pay a penalty. So, a home loan balance transfer must always be opted for after doing a thorough cost-benefit analysis. 

Opt for Affordable Housing 

Home loan borrowers are eligible for home loan tax benefits. Under Section 24b, a home loan borrower can claim up to Rs.2 Lakh on payments made towards interest component repayment and under Section 80C, borrowers can claim up to a maximum of Rs.1.5 Lakh. 

Over and above this, first-time homebuyers who opt for affordable housing can also claim home loan tax benefits under Section 80EE and Section 80EEA of the Income Tax Act. The maximum limit permissible under Section 80EE is Rs.50 Lakh and that under Section 80EEA is Rs.1.5 Lakh. Therefore, one can claim these extra tax benefits available through these sections and make their home loan affordable. 

Understand the Factors that Affect the Home Loan Interest Rates You Get 

If you wish to avail yourself of affordable housing, it is of utmost importance that you secure the loan on the lowest home loan interest rates and that is possible only when you understand the factors that affect your home loan interest rates. 

To secure a low home loan interest rate, you must maintain a stable job and income. People with stable incomes rarely default on loan repayment and therefore, such individuals are extended loans on the most beneficial loan terms and conditions. 

Similarly, individuals with a CIBIL score in the range of 750 to 900 are also extended highly beneficial loan terms and conditions and so are individuals who opt for a low LTV ratio loan or maintain a low debt-to-income ratio. 

Make sure to apply for a home loan with the most ideal credit profile if you wish to be considered for the best and most affordable home loan you can get. 

Final Words

The average tenor for a home loan is 20 years. Most people choose to repay their loan over 20 years. Thus, if not planned well or if availed of at high interest rates, a home loan can easily become a burden. So, one must make every effort to secure an affordable home loan by keeping the above tips in mind.