Beyond Interest Rates: Factors to Consider When Choosing a Home Loan in Varanasi
Owning a home is one of the important goals we aspire to achieve in life. It is one of the biggest investments, financially and emotionally. Hence, buying a home needs huge financial support. If you are short on cash or do not want to liquidate your investments, a home loan in Varanasi can offer great financial assistance. In this blog post, Bhumi Finance will elucidate the key factors to consider while taking a home loan to simplify your home loan application and repayment process.
- The Rate of Interest
The interest rate of your home loan in Sant Kabir Nagar plays a significant role in deciding whether or not to avail of a loan and which lender to choose. There are three types of interest rates. A floating interest rate, also known as a variable interest rate, may change during the loan tenure as it is subject to the current lending rates. Fixed interest rates, on the other hand, offer a fixed interest rate home loan i.e. the rate of interest remains the same throughout the loan tenure, and thus, your EMIs do not change. The third type of interest rate is the hybrid interest rate or combination interest rate is a combination of floating and fixed interest rates. Many lenders and business loan agents in Varanasi such as Bhumi Finance offer a fixed interest rate for a certain period, which then can be switched to a fixed interest rate. This type of interest rate could be a wise option when you get a home loan in Gorakhpur at a lower interest rate.
- Loan Amount
Your loan amount impacts several things in the home loan in Varanasi. The rate of interest generally differs for the loan amount up to 30 lakhs, above 30 lakhs up to 75 lakhs, and above 75 lakhs. Since a home loan is a long-term commitment, it is advisable to opt for a loan amount that you will be able to repay comfortably for a long time.
- Your Repayment Tenure
A business loan in Gorakhpur or a home loan is generally availed for a longer loan tenure of up to 30 years, depending upon your eligibility. The longer loan tenure helps you lower the monthly repayments but ultimately increases your total interest outgo. Whereas choosing a shorter loan tenure can create a burden of huge EMIs. But, if you wish to start repaying the principal, you can start paying the pre-EMIs.
- Paying the Down Payment
Suppose you applied for a home loan in Sant Kabir Nagar of Rs 70 lakhs, and the bank approves it for Rs 50 lakhs based on your eligibility. In this case, you will have to pay Rs 20 lakhs from your pocket. This amount that you pay on your own is called a down payment. You should make as much down payment as you can without stressing your budget, as it will help you lower the loan amount.
- Processing Fees & Charges
The lender charges you a processing fee to process your loan application. The amount of the processing fee depends on the loan amount as most banks and housing finance companies charge processing fees as a fixed percentage of the loan amount. Since home loan in Gorakhpur amounts are usually high, even a small difference in the percentage can make a considerable difference.
So, these were certain factors that one should consider before opting for a home loan. Wish to seek a quote? Reach out to us now at https://bhumifinance.com/. We also offer a business loan in Jaunpur. Visit us to know more.