Contents

  1. Home Loan Interest Rates
  2. Eligibility
  3. Documents needed
  4. EMI Calculator
  5. Process of Applying
  6. Differences between a Mortgage and Home Loan

Home Loan Interest Rates

The average loan interest rates are from 2.5% to 12.00% in India as of March 2021. The rates typically vary from investor to investor, RBI-prescribed repo rate, inflation, economic activities, and lots of alternative factors. Some banks conjointly provide a special privilege to ladies, bank staff, and senior voters by providing a 0.05% concession on the house loan charge per unit. Further, a loan charge per unit will either be fastened or floating in nature. A fixed-rate loan remains constant for an amount fixed by the bank. this sort of loan is resistant to market fluctuations.

In the case of floating-rate home loans, the charge per unit applicable varies supported by the market fluctuations. it should or might not be useful for the receiver.

Eligibility

Banks have a listing of eligibility criteria for home loans. the primary factor banks scrutinize is one’s credit history to grasp reimbursement habits. Typically, a credit score of 750 and on top of is the most popular. another necessary factor taken into consideration is as follows:

  • Age
  • Employment sort
  • Minimum Annual earnings
  • Collateral Security
  • Margin necessities
  • Assets, liabilities, stability, and continuity of occupation
  • Residency standing (Resident Indian/ Non-Resident Indian)

Documents needed

The following documents are needed, together with your duly-filled application.

Agriculturists

  • Application kind with photograph
  • Identity and Residence proof
  • Last 6 months’ bank statements
  • Processing fee cheque
  • Copies of Title Documents of Agricultural Land depiction Landholding
  • Copies of Title Documents of Agricultural Land depiction of crops being cultivated
  • Statement of previous a pair of years of loans availed

For Salaried Customers

  • Application kind with photograph
  • Identity and Residence proof
  • Last 6 months’ bank statements
  • Processing fee cheque
  • Latest earnings Slip
  • Form 16

Businessmen/Non-Salaried Professionals

  • Application kind with photograph
  • Identity and Residence proof
  • Last 6 months’ bank statements
  • Processing fee cheque
  • Educational Qualifications Certificate and Proof of Business
  • Business Profile and former three years revenue enhancement returns (self and business)
  • Previous three years Profit/Loss and record

EMI Calculator

  • Generally, the EMI calculator could be a straightforward and handy tool that calculates the monthly quantity collectible to the investor (bank) in terms of a loan.
  • You can attempt our loan EMI Calculator to seek out the EMI you will get to pay each month for a selected loan quantity and comprehend your affordability well before.
  • The home loan calculator is simple to use as you have got solely to enter the values of the principal loan quantity you’re aiming to borrow (P), the time length (N), and also the rate of interest (R).

Process of Applying

  • Availing a loan has gotten easier than before, because of the assorted mediums that exist currently with the arrival of technology. One will either attend the bank branch directly, inquire regarding the house loan choices, or choose a web application.
  • Upon applying, the bank collects the desired documents from you. It initiates the process of your application, together with checking of CIBIL score, the worth of the plus, eligibility calculation supported your financial gain and liabilities, and more.
  • After evaluating and collateral all the documents, the banks commit to approve or reject the loan.

Differences between a Mortgage and Home Loan

Some factors of distinction between a home loan and a mortgage loan include:

Use

While a loan will solely be wont to finance the acquisition or construction of a home, a loan is often utilized to fulfill a range of monetary wants, together with education, wedding, and medical emergencies.

Loan-to-value ratio

A loan will cowl 80-90% of a property’s current value, whereas a loan will solely cowl seventy-fifth of a property’s price.

Interest rate

Another distinction between mortgage loans and residential loans is that home loans have lower interest rates than mortgage loans. IDFC 1st Bank offers mortgage loans ranging from 7.5%, however, home loans begin from 2.5%.

Processing fees

A home loan’s process charge varies from 0.2-1% of the loan quantity. However, loan process fees are still higher. Lenders charge a processing fee of roughly 1.5% of the loan quantity.

Loan tenure

A loan offers an extended payback tenure, which may typically go up to thirty years. Mortgage loans usually have a payback amount of up to fifteen years.