Everyone dreams to have a property. However, home buyer need to be aware of some crucial mistakes that can affect negatively. If you want to take a home loan, Here, I am writing some ten common mistakes you should avoid while applying for a home loan.
1. Know what you want.
Before beginning your process of buying a home, you have to conduct good research; don't always trust someone else's research or even your relatives/ friends. Go and ask by visiting the property. During your discussions with the developer, don't reveal your budget, he may substantially increase its basic cost. Always prefer to ask the developments of the project/house and match with your requirements.
2. Take credit report
Before starting negotiations with the banks, you should be ready with your credit report and check for any discrepancies. A negative credit reprot may affect your negotiations and sometimes may lead to huge cut in your bank loan. Always prefer to select a bank which gives loan at low interests.
3. Take practical aspects, think wisely.
Many times people tend to take loans with EMI 40-50% of their net monthly income. However, you should take care of expenditures which may come during the course of loan period. If you make any miscalculation, it may result in over borrowing. Your pleasure of obtaining a beautiful home, will therefore be overshadowed.
4. Do Enough research on developers/lenders
Don't finalize with the developers rate, always try to bargain upto 20% of the cost. He will get more than 200% profit on what amount he gives after your bargaining. Conduct enough research on price trends, follow websites like Indian property.com, 99acres, Magicbricks.com etc, where you can get unbiased information. Also, always do not prefer online booking. Always ask for processing fee, pre-payment penalties, percentage of loan granted and documents from your bank.
5. Do not accept online loans
Although these loans are easy to get, huge interests may bring troubles to you. Better go to your preferred banks like SBI, HDFC, HSBC and ask for your loan eligibility.
6. Disclose all information
It is your responsibility to disclose all truth before any bank. Having large credit dues and other loans, will have significant impact on your home loan eligibility.
7. Read entire documents thoroughly
Before you sign any document, take some time to read them carefully and get is clarified before your agreement. Reading through your loan documents will ensure that you know exactly what your doing.
8. Get your finances in an order.
Make a detailed sheet of income and expenditures and calculate wisely your eligibility and how much you can afford. This will show your current financial status and add your projections that may get in future either loss or gain.
9. Take Home insurance loan cover
Most of the people doesn't know if anything happens suddenly to you, who has to pay the remaining balance. If you take home insurance loan cover, it will help you and your family in clearing the debts and clears the remaining loan amount.
10. Select lender with right attitude
Always believe that lender will not do it for free and loss. He has his own interests at heart and can take advantage of you. Always insist of hidden costs before buying any property.
So beware and proceed to fulfill your dream home project.
1. Know what you want.
Before beginning your process of buying a home, you have to conduct good research; don't always trust someone else's research or even your relatives/ friends. Go and ask by visiting the property. During your discussions with the developer, don't reveal your budget, he may substantially increase its basic cost. Always prefer to ask the developments of the project/house and match with your requirements.
2. Take credit report
Before starting negotiations with the banks, you should be ready with your credit report and check for any discrepancies. A negative credit reprot may affect your negotiations and sometimes may lead to huge cut in your bank loan. Always prefer to select a bank which gives loan at low interests.
3. Take practical aspects, think wisely.
Many times people tend to take loans with EMI 40-50% of their net monthly income. However, you should take care of expenditures which may come during the course of loan period. If you make any miscalculation, it may result in over borrowing. Your pleasure of obtaining a beautiful home, will therefore be overshadowed.
4. Do Enough research on developers/lenders
Don't finalize with the developers rate, always try to bargain upto 20% of the cost. He will get more than 200% profit on what amount he gives after your bargaining. Conduct enough research on price trends, follow websites like Indian property.com, 99acres, Magicbricks.com etc, where you can get unbiased information. Also, always do not prefer online booking. Always ask for processing fee, pre-payment penalties, percentage of loan granted and documents from your bank.
5. Do not accept online loans
Although these loans are easy to get, huge interests may bring troubles to you. Better go to your preferred banks like SBI, HDFC, HSBC and ask for your loan eligibility.
6. Disclose all information
It is your responsibility to disclose all truth before any bank. Having large credit dues and other loans, will have significant impact on your home loan eligibility.
7. Read entire documents thoroughly
Before you sign any document, take some time to read them carefully and get is clarified before your agreement. Reading through your loan documents will ensure that you know exactly what your doing.
8. Get your finances in an order.
Make a detailed sheet of income and expenditures and calculate wisely your eligibility and how much you can afford. This will show your current financial status and add your projections that may get in future either loss or gain.
9. Take Home insurance loan cover
Most of the people doesn't know if anything happens suddenly to you, who has to pay the remaining balance. If you take home insurance loan cover, it will help you and your family in clearing the debts and clears the remaining loan amount.
10. Select lender with right attitude
Always believe that lender will not do it for free and loss. He has his own interests at heart and can take advantage of you. Always insist of hidden costs before buying any property.
So beware and proceed to fulfill your dream home project.
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