A "low interest" loan shouldn't mean you have very little interest in paying it back!
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  • Home Loan Guide for First Time Home Buyers Reviews

    • Punjab National Bank Home Loan
      "PNBHFL Review"
      0.5 1.5/5 "Bad"
      Not a good experience. No proper communication once loan agreement is signed. One of the disbursement got 1 month late for which late payment charges was applied to me. I have got sanctioned loan of 34 lacs and policy was included with 1.5 lacs amount saying that its free of cost. But this amount got added to total loan amount ie 34 + 1.5 total 35.5 lacs. So I will be paying return on 35.5 lacs.
      Was this review helpful? 0
      , thane
      Reviewed on Aug 17, 2017
    • LIC Housing Home Loan
      "Very good service"
      0.5 4.0/5 "Great!"
      I have got the Housing loan from LIC housing loan. They have disbursed my loan within 15 to 20 days. The response they gave was very good in regards to my home loan application. The rate of interest was comparatively equal with the other banks with LIC HOUSING FINANCE.
      Was this review helpful? 0
      , kota
      Reviewed on Aug 17, 2017
    • LIC Housing Home Loan
      "Very good service"
      0.5 4.0/5 "Great!"
      I have got the Housing loan from LIC housing loan. They have disbursed my loan within 15 to 20 days. The response they gave was very good in regards to my home loan application. The rate of interest was comparatively equal with the other banks with LIC HOUSING FINANCE.
      Was this review helpful? 0
      , kota
      Reviewed on Aug 17, 2017
    • Citibank Home Loan
      "Good overall"
      0.5 4.0/5 "Great!"
      Citibank has been good in the home loan services and to get this loan through, it was a easy task. I never faced any inconvenience to get the disbursement and even after the loan was disbursed. The interest rate and charges are also normal. Services are good in all.
      Was this review helpful? 0
      , pune
      Reviewed on Aug 16, 2017
    • SBI Home Loan
      "Home loan"
      0.5 5.0/5 "Blown Away!"
      Thankfully SBI has offered this housing loan to me. Being a joint account holder, I am very much happy in taking the housing loan, my income was very less but they some how helped us which is the best part. Special efforts were actually taken by them they suggested stating that they can offer the loan by clubbing wife and husband's income so that we can take the loan easily . I am happy with the rates offered as it was floating . To conclude, I am completely happy with their service.
      Was this review helpful? 0
      , ernakulam
      Reviewed on Aug 16, 2017
    • HDFC Limited Home Loan
      "Not Good"
      0.5 1.0/5 "Really Bad"
      I had gone through some issues with HDFC limited when I was taking the home loan. Because, they made me to pay for 3 EMIs. Which is not at all required. I felt that I had paid some more charges as a processing fee and other irrelevant charges. Even I do not have any property insurance, but they had forced me to pay for insurance. I am not at all happy with HDFC Limited.
      Was this review helpful? 0
      , mumbai
      Reviewed on Aug 16, 2017
    • SBI Home Loan
      "Need an improvement"
      0.5 1.0/5 "Really Bad"
      In the market other banks are providing home loan to a gram panchyat property but SBI is not providing the home loan. My property located in Channanagar at Hyderabad but SBI have rejected my application, their loan norms are very strict and they asking lot of documents with heavy paper works.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Aug 16, 2017
    • ICICI Bank Home Loan
      "Very Good service"
      0.5 5.0/5 "Blown Away!"
      I have applied Home loan with ICICI bank. They are fast in their process, they fixed an appointment to collect the documents after that they told the required documents were missing so that was the reason I haven't proceed with ICICI bank. The rate of interest is low when compared with others banks.
      Was this review helpful? 0
      , bangalore
      Reviewed on Aug 16, 2017
    • Bank Bazaar Customer Support
      "Good "
      0.5 5.0/5 "Blown Away!"
      It was a good experience, I enjoyed it and I will let other customers also know more about bankbazaar and I will also refer the same process to others to get the loan . Hope further things will also be smooth and processing fees should be made less by Hdfc bank .
      Was this review helpful? 0
      , kanpur
      Reviewed on Aug 14, 2017
    • Bajaj Finserv Home Loan
      "Very good services"
      0.5 5.0/5 "Blown Away!"
      My home loan was approved within minutes by Bajaj Finserv. The customer services are good and the overall experience was nice. I been a very long time customer of this company and I have always got the best of services. The interest and rate and charges are normal.
      Was this review helpful? 0
      , ghaziabad
      Reviewed on Aug 14, 2017
    • Bank Bazaar Customer Support
      "For home loan"
      0.5 4.5/5 "Excellent!"
      It's very easy to process the home loan ,I am very satisfied with bank bazar app ,very good. Customer care service is very helpful and quick service was provided with in 24 hours ,it's really good and comfortable service that I received from bank bazar.com Thanku bankbazr
      Was this review helpful? 0
      , kolkata
      Reviewed on Aug 13, 2017
    • HDFC Limited Home Loan
      "Poor Service"
      0.5 1.5/5 "Bad"
      Very poor service. They claim to be transparent on the process and commitment , however, have a very poor support. @Sector 62, Noida branch. Till the time processing fees is not encashed, all is good, after , complete turn around on the attitude and response. You can be even cheated after commitment done.
      Was this review helpful? 0
      , gurgaon
      Reviewed on Aug 13, 2017
    • Bank Bazaar Customer Support
      "Excellent service"
      0.5 4.0/5 "Great!"
      Bankbazaar provides complete service. The comparability option is very good in bank bazaar website, I would say it helps to choose the best product in the market. The website of bank bazaar is easy to use and user friendly, I am happy with bank bazaar service.
      Was this review helpful? 0
      , pune
      Reviewed on Aug 12, 2017
    • SBI Home Loan
      "Excellent service"
      0.5 4.0/5 "Great!"
      The Overall process was very good from SBI home loans, The executives are really good and they were updating me the status on time to time. They have disbursed my loan within 2 weeks of time. I am happy with the loan amount . The rate of interest is nominal with SBI. I am satisfied with the SBI service.
      Was this review helpful? 0
      , pune
      Reviewed on Aug 12, 2017
    • review Home Loan
      "Better service"
      0.5 5.0/5 "Blown Away!"
      Got home loan from Equitas housing finance. They have approved the loan amount around Rs,10lakhs based on my documents, they have promised that they will release the documents to make the account as current account. The rate of interest is high when compared with others.
      Was this review helpful? 0
      , dindigul
      Reviewed on Aug 12, 2017
    • Axis Bank Home Loan
      "Very worst service"
      0.5 1.0/5 "Really Bad"
      I have applied home loan with Axis bank , they told that I am eligible to get loan upto 12lakhs but I have asked only 10lakhs, Axis bank has sanctioned my loan, But they never released the loan amount, by saying that I had back log with ICICI bank.
      Was this review helpful? 0
      , dindigul
      Reviewed on Aug 12, 2017
    • review Home Loan
      "Satisfied with the services"
      0.5 5.0/5 "Blown Away!"
      Canfin homes Ltd is good in the process. I have taken a home loan and I had no issues in getting the loan and also after the loan was disbursed. The interest rate and processing charges is also reasonable. The documentation is nominal and hassle free.
      Was this review helpful? 0
      , tirunelveli
      Reviewed on Aug 12, 2017
    • Bank Bazaar Customer Support
      "Excellent platform and user friendly site for home seekers"
      0.5 5.0/5 "Blown Away!"
      I felt very nice and happy to see user friendly interface and hassle free process. This is really a great website which is like an angel to many home seekers like me. Today I visited the site in the morning and within one hour I am able to see great quotation. Thanks to all of you.
      Was this review helpful? 0
      , silvassa
      Reviewed on Aug 12, 2017
    • ICICI Bank Home Loan
      "Good Experience"
      0.5 4.0/5 "Great!"
      As per the market, ICICI gave me best interest rate for the home loan, initially I don't want insurance but they took the amount from the disbursed and they return the money back. I took the home loan of Rs. 32 lakhs for the tenure of 15 years. I am really satisfied with their service
      Was this review helpful? 0
      , hyderabad
      Reviewed on Aug 12, 2017
    • Bank Bazaar Customer Support
      "Very good service"
      0.5 4.0/5 "Great!"
      Bank bazaar helped me to choose the financial product and in understanding them with thin the service time. The website of bank bazaar is easy to use and user friendly,. The user interface is good with bank bazaar , I am comfortable using bank bazaar service.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Aug 12, 2017
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    Home Loan Guide for First Time Home Buyers is Rated as "Great!" by 22916 Users

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    Home Loan BYTES FROM OUR KITCHEN

    An extensive home loan guide for first-time home buyers:

    If you’re one of the millennials, you’d know that owning a home has long since been the quintessential Indian dream. But in the 21st century, where an entire world’s economy hinges on a volatile stock market, buying one doesn’t come easy. If you are a first-time home buyer in particular, you need to be equipped with the know-hows of how a home loan works in the current scenario.

    While the internet is already rife with plenty of guides to help you through a home loan process, the ones available simply aren’t effective enough as they don’t cover all the bases. However, you can count on this page to give you all the information you need. From the mundane to the magnificent, you will learn all that you need to about a home loan.

    So, let’s begin with the essentials.

    Home Loan: What is it?

    A Home Loan is basically a form of financial reinforcement availed of to fund the purchase or construction of a house. In the present times, a home loan can also be used to refinance an already existing home loan or simply reimburse the cost of buying a second-hand property.

    Home Loan and Its Basic Types:

    There are several different types of home loans, depending on the purpose they are used for. Some of the most commonly seen ones are:

    • Home Purchase Loans

      Home purchase loans are, by far, the most popular types of home loans in India. This is where an individual uses the disbursed loan amount to purchase a newly built apartment or an already constructed property. Nearly every bank and financial institution in India offers this type of loan. Each of the banks, however, follow their own interest rate policy and loan terms.

    • Land Purchase Loans

      Land purchase loans, as the name suggests, are used to fund the purchase of a land where an individual is planning to construct their home. Lenders usually provide a maximum of 85%-90% of its cost, while the other 15% should be put together by the applicant.

      All the major banks and NBFCs like HDFC Bank, Axis Bank, Punjab National Bank, and DHFL among many other offer land purchase loans, albeit under a different names.

    • Home Construction Loans

      These type of loan is available for individuals who are planning to build a house of their own land. The application and approval process to avail this loan though is a little tricky. Take for example, if the individual wants the cost of land to be included as a component for the total price of the house, they must have bought the property within the previous year.

      Again, every major bank in India like HDFC, Axis, State Bank of India, Canara Bank, UCO Bank et al offer this type of loan.

    • Home Improvement Loans

      Home improvement loans are taken by individuals who are unable to mobilise enough funds to renovate the house they are living in. The maximum home improvement loan an individual is eligible for depends entirely on their debt-to-income ratio and their financial standing.

    What Is The Eligibility Criteria for a Home Loan?

    All banks and NBFCs in India have their own eligibility criteria a prospective home loan buyer has to meet. Here’s a list of the primary requirements.

    1. You need to be aged between 18 and 60 years.
    2. You need to be a salaried or a self-employed individual with a steady income.
    3. You need to earn more than the minimum income quoted by the banks.

    These three aspects qualify you for a loan. However, there are a few other factors on which your application hinges. They are:

    1. Your monthly income: When you apply for a home loan with any lender, you need to prove to them that you have at least 50% of your income ready to serve the EMIs.
    2. Other loan commitments: Having a high monthly income doesn’t necessarily guarantee you a home loan. Also, if you are in the pursuit of repaying any other loans, the total loan amount you’ll be eligible for will significantly decrease. This is why you need to make sure to clear every other loan commitment before applying for a home loan.
    3. Your down payment capability: A lender never gives out the entire loan amount you’ve applied for. In fact, the most they will give you is 80% of the value of the property. The other 20% funds should be mobilised by you. If you are applying for a new home loan, you should make sure to have the down payment fund ready so that your application doesn’t get rejected.

    What are The Documents Required to Apply for a Home Loan?

    Every home loan provider more or less follow the same documentation process before signing off on the loan application. Here are a list of documents you need to keep ready when you decide to take a home loan.

    1. Fully filled and signed application form along with a photograph.
    2. Identification proof and residence proof: For ID proof you can provide anything like your PAN Card and for residence proof, you need to provide a copy of your passport/driving license or any of the latest utility bill.
    3. Cheque for the processing fee.
    4. Bank statements of the previous 6 months.

    Besides these, there are also a few other documents you need to provide depending on whether you are a salaried or a self-employed professional.

    Salaried professionals need to provide their pay-slips for the last three months along with their Form 16 or Income Tax Returns (ITR) filing.

    Self-employed professionals, on the other hand, need to provide proof of education qualification certificate and proof of their business’ existence. Apart from this they need to provide proof of ITR for the previous three years which should also include the computation of income. Lastly, they need to provide a CA audited/certified balance sheet and profit-loss account for the previous three years.

    What are The Different Types of Home Loan Interest Rates in India?

    Before we head into home loan interest rates in India, let’s first ascertain how a rate is fixed. An interest rate on a home loan is dependent on two policies: Marginal Cost of Lending Rates (MCLR).

    MCLR policy is a policy brought into effect by the Reserve Bank of India (RBI) from April 2016 in place of Repo Rate policy. It plays a featuring role in determining the home loan lending rates set by financial institutions. Under this policy, banks need to fix a base rate based on their cost of running business based on which which they can quote an interest rate as per the borrower’s risk factor.

    If RBI increases or decreases the repo rate significantly, banks and financial institutions need to follow suit to correct the base rate as per guidelines.

    Now, that the basics of how an interest rate is set is ascertained. Let’s talk about the different types of interest rates available in India, of which they are two.

    1. Fixed Interest Rate Home Loan:

      A fixed interest rate home loan is a type of home loan rate, wherein the interest rate is fixed for the entire tenure of the loan. This means that the interest rates aren’t likely to change even if there are significant changes in the economic market. Under this type of loan, a major component of EMIs in the beginning go into servicing the interest while the principal repayment only comes in the latter half.

      Some of the advantages and disadvantages of Fixed Interest Rate Home Loan include:

      Advantages Disadvantages
      Interest rate stays the same through the tenure, which brings a level of certainty for the borrower. These loans usually workout a good 1%-2.5% more than floating rate loans.
      Helpful for good budgeters as it comes with a fixed monthly repayment schedule. Borrowers cannot take the advantage of an interest rate cuts during their loan tenure.
    2. Floating Interest Rate Home Loan:

      A floating interest rate home loan is a home loan where in the rate of interest varies according to the market conditions. This means that interest can either go up or down depending on how the market is performing.

      Some of the advantages of floating interest rate home loan include:

      Advantages Disadvantages
      Comparatively cheaper than fixed interest rate home loans, as long as the market remains stable. Market is volatile and any unexpected downturn can increase the interest rates and in turn EMIs significantly.
      This type of loan is cyclical as interest go up and come down often. This helps a borrower save a considerable sum on interest paid. If the rate goes beyond 11.5% or so, this type of loan can become an expensive burden for the borrower.

    Things That Affect Your Home Loan Application and Approval Process

    There are plenty of factors that will have a bearing on how your loan application fares with a a lender you have chosen to apply with. They are:

    1. Age
    2. Income bracket
    3. Property type and its location
    4. Market value of the property

    After you submit the required documentation to the lender, they will thoroughly vet the details you’ve provided to ensure that they check out. Depending on their findings, you will be offered a loan deal. One important thing you should understand here is that their findings will be directly proportional to the term and conditions you get.

    What Are The Home Loan Deals Offered By Some of The Leading Banks?

    Here are some of the best home loan deals offered by some of the leading banks in the country.

    • State Bank of India:

      SBI, one of the largest banks in the world, currently offers a floating rate home loan deal with a base rate of 9.75% per annum. The lending rates, however, are slightly higher. For a loan of up to Rs. 30 lakhs, the interest rate stands at 0.25% above the base rate, effective bringing the overall interest to 10%. For loans above Rs. 30 lakhs, the rate stands at 0.40% above the base rate, which brings the rate to 10.15%. The maximum tenure SBI offers goes up to 30 years.

    • HDFC Bank

      HDFC Bank, one of the largest financial institutions in India with regards to market capital to market capitalization also has an extensive home loan offering. The bank uses the Retail Prime Lending Rate (RPLR) - Spread formula to determine the interest rate, where in RPLR is the minimum rate at which the it lends and spread is discount or markup offered on the loan.

      It basically offers 3 different variants of home loans. They are:

      1. Called the Adjustable Rate Loan, this loan offers any amount at a rate that goes between 9.45%-9.95%. Here’s a table that lists the rates.
        Loan Amount Interest Rate (p.a.) RPLR - Spread
        For Women* (Any Loan Amount) 9.40 to 9.90 RPLR - (6.90 to 6.40)
        Any Loan Amount 9.45 to 9.95 RPLR - (6.95- 6.45
      2. Known as the TruFixed Loan, this loan comes with 2 and 3 year fixed rate variant. In this case too, the bank is ready to offer any loan amount.
        Loan Amount Interest Rate during 2nd and 3rd year of fixed rate term (p.a.) Interest rate after the end of fixed rate term
        For Women* (Any Loan Amount) 9.50 to 10.00 RPLR - (6.80 to 6.30)
        Any Loan Amount 9.55 to 10.05 RPLR - (6.75- 6.25)
      3. This is yet another offering, known again as TruFixed Loan, is available for 10 year fixed variants.
        Loan Amount Interest Rate after the 10 year fixed rate term (p.a.) Interest rate after the end of fixed rate term
        For Women* (Any Loan Amount) 9.70 to 10.20 RPLR - (6.60 to 6.10)
        Any Loan Amount 9.75 to 10.25 RPLR - (6.55- 6.05)
    • ICICI Bank:

      ICICI Bank, also among the leading banks in the country is offering a good home loan deal too. Here’s are a few tables that list out ICICI bank’s offering for salaried and self-employed individuals.

      For all intents and purposes I-MCLR- 1Y is the home loan benchmark set by the bank.

      1. Fixed Interest Rate for full tenure:
        Loan Amount Effective Rate of Interest (p.a.)
        Upto Rs. 30 lakh 9.75%
        Above Rs. 30 lakh 9.85%-10.10%
      2. Floating Interest Rate Loan:
        Loan Amount Effective Rate of Interest (p.a.) Rate
        Upto Rs. 5 crores 9.45% I-MCLR-0.30%
        Above Rs. 5 crores 9.75% I-MCLR-0.55%
      3. Fixed Interest Rate for 2,3 years:
        Loan Amount Fixed rate for 24/36 months Floating rate from 25th/37th month
        Upto Rs. 5 crores 9.35% I-MCLR-1Y +0.35%
        Above Rs. 5 crores 9.70% I-MCLR-1Y + 0.60%
      4. Fixed Interest Rate for 5,10 years:
        Loan Amount Fixed rate for 60/120 months Floating rate from 61st/120th month
        Upto Rs. 30 lakhs 9.45% I-MCLR-1Y +0.35%
        Above Rs. 30 lakhs 9.55%- 9.80% I-MCLR-1Y + (0.45% to 0.70%)

    What Are The Things You Should Keep in Mind Before Applying For a Home Loan?

    A home loan can be a massive burden if you don’t consider all the details that go into it. Here are a few things you should keep in mind before applying for one.

    1. Your Borrowing Capacity:

      You shouldn’t opt for a higher loan amount just because you draw a bigger paycheck. Before applying for a home loan, you should carefully understand your borrowing capability. But, how can one exactly find out the loan amount they are eligible for? It’s fairly simple.

      First things first, you need to keep in mind all the expenses you incur in a month. These may include your regular household expenses, travel, kids’ fees, utility bills, pending loan payments, and miscellaneous expenses. Once you’ve listed down all these expenses, the amount you are left with is what you can use to make the EMI payments on the home loan.

    2. Credit Score:

      You may not feel the importance of credit scores all that much, but it is the most crucial determinant of the interest rate you are likely to get. For a good home loan rate, you will need to maintain a credit score of 750 or above. Having a score such as this would endear a lender to you as they are less likely to be a liability for them. This will also help you get an interest rate which is a which basis points lower that what they officially claim.

    3. Loan Tenure:

      Home loans can often go on for over 20 years, and up to 30 years, in the case of SBI. Analyse the loan tenure you’ve been offered and see if the tenure works out for you. If you think you need more room, negotiate a better term with the bank or reduce the total loan amount you have applied for instead.

    4. The Terms and Conditions of The Loan:

      The terms and conditions you sign when borrowing a home loan is legally binding, which suggest that you have read all the terms and conditions laid out by the bank and comply with the offer. What you may not know, however, is that this is also one of the places where lenders tend to add draconian clauses and enforce them. So, avoid falling into such rabbit holes and make sure to go through all the clauses and sub clauses mentioned in the loan agreement before signing on the dotted lines.

      In the current market, purchasing a home is nothing short of an achievement. To make the best out of the situation always make sure to take a well-informed decision.

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