Owning a home is a dream that all of us wish to make a reality. However the rising realty rates pose a challenge for many aspiring home owners. Sinking a large amount of money into a home is also a poor investment move. Those who cannot afford to pay for a home on their own can avail of a home loan from a home finance company.
Mahindra Rural Housing Finance Limited (MRHFL) is one such home finance company. Part of the Mahindra Group, the company provides home finance options to individuals looking at options to finance their home acquisition. The company was established to provide housing loans catering to the rural segment at affordable rates of interest, but they also provide loans in urban areas.
The company is known for its transparency and fair dealings when it comes to property valuation as well as excellent customer service, making it one of the best choices in the home finance segment.
Mahindra Finance offers its customers a number of loan offerings, especially designed with the rural population in mind. This makes their loans unique as they provide a variety of home finance options to a generally neglected section of society. The features that set their home loans apart from their competitors are listed below:
MRHFL offers its customers a variety of loans to suit every budget and need when it comes to home finance. Given below are a list of its various offerings.
Home Construction Loan: Looking at building a home but don’t have the money to fund it? The Home Construction loan from MRHFL will help you realise your dream by providing up to 75% of the total cost of the construction. The loan can be repaid over a 20 year period at very affordable interest rates.
Home Loan: A number of individuals wish to buy a home but put it off because they cannot afford to pay for it. With MRHFL’s Home Loans, now everyone can buy a home, as they will receive up to 75% of the property’s value as loan amount. The loan can also be repaid over a 20 year period at reasonable interest rates. The actual amount sanctioned would depend on the applicant’s repayment capability, incomes, liabilities etc.
Renovation Loan: For those looking at renovating or making improvements to their homes, the renovation loan will help finance the cost of these renovations/improvements up to a maximum of 75% of the total cost. The applicant can also pay the loan back in monthly instalments over a period of time instead of a lump sum amount.
Home Extension Loan: Wish to extend your home by building an extra room or adding space overhead? You can avail a loan to finance the construction of an extension to your home, with MRHFL providing up to 75% of the total construction cost as a loan amount. This amount can be paid back over the tenure of the loan, up to a maximum of 20 years.
Joint Liability Group Loan: Those in the rural areas who find it difficult to fulfil the eligibility criteria for a loan individually can apply for a joint liability loan. This loan can be applied for by a group of not less than 3 and not more than 5 members, who would be collectively responsible for repaying the loan amount. Another advantage of this type of home loan is it is collateral-free, allowing groups such as artisans, landless laborers, and tenant farmers to apply for such a loan.
Applying for a home loan is now possible thanks to Mahindra’s range of home loan options. However those wishing to apply for a loan have to check their eligibility first. The eligibility criteria are designed to ensure that applicants are able to repay the loan amount. Indian citizens who have attained majority can apply for a home loan.
Once applicants have met the eligibility criteria for a home loan, they are required to submit documentation to the company based on which their loan will be sanctioned. This documentation includes a detailed history of their finances, as well as proof of identity and residence. The company verifies the documents and ascertains if the applicant would be capable of repaying the loan by scrutinizing his credit score, saving habits, income, liabilities and assets etc.
The list of documents to be provided to MRHFL is mentioned below:
The company offers very reasonable rates of interest on all its loan offerings. Since the loans are primarily targeted at applicants in the rural areas who are unable to afford the capital needed to purchase a house, the rates are kept low, ensuring everyone has access to a loan. The current rates of interest on home loans is 18% per annum for a fixed term loan and 11.50% per annum onwards for a floating rate loan. The interest rate for non-housing loans is 17% per annum onwards.
A home loan is essentially money loaned to an individual for a period of time which he has to pay back in instalments every month. Individuals who have applied for a home loan would need to consider how they would be repaying their loan amount so they do not default on it which would negatively affect their credit score. To do this, they would need to plan their finances and monthly budget to take into account this additional expense. MRHFL makes it easier for them to do this through its EMI calculator. This calculator computes the amount that has to be paid every month, and all applicants have to do is fill in their loan amount, the loan tenure and the rate of interest. The calculator will generate the monthly payable amount, thereby giving loan applicants an estimate of the amount they would be required to pay towards settling their loan. It should be noted, however, that the EMI calculator provides an estimated figure, and applicants should check with the company for the final amount to be paid.
As a special feature, the loan can be repaid in equated instalments on a monthly, quarterly or half yearly basis through cheque, demand draft or cash.
The loan amount will be calculated based on the below criteria:
Given below are the other charges levies on the home loan:
|Processing Fee||2.4% of loan amount, inclusive of service tax|
|Documentation charges||2.5% of loan amount, inclusive of service tax|
|Late payment penalty||24% per annum on the amount that is overdue|
A guarantor is not mandatory for a home loan, but the company may insist on one at their discretion.