Owning a home is a dream that many aspire to fulfill. Fortunately, with the availability of different types of home loans, this dream has become more attainable for people across India. Whether you are a first-time homebuyer or looking to renovate your current home, understanding the various options available to you is crucial. In this article, we will delve into the six types of home loans in India, explaining their features and benefits, eligibility criteria, and more. So, let’s dive in and explore the world of home financing!
The Floating-rate Home Loan, also known as an Adjustable-rate Home Loan, is a popular choice among homebuyers. This type of loan comes with an interest rate that fluctuates in line with market conditions. As the interest rates change, your EMIs (Equated Monthly Installments) may vary, but it can work in your favor if rates decrease. However, it’s essential to be prepared for potential rate hikes.
In fixed-rate home loan interest rate remains constant. This means your EMI (equated monthly installment) stays the same, regardless of any market interest rate fluctuations. Fixed-rate home loans are perfect for those who prefer stable EMIs and want to avoid unexpected changes in their monthly payments. However, it’s essential to note that fixed-rate home loans interest rates can be higher than floating-rate ones.
A home loan balance transfer is when you move the remaining amount of your current home loan to another bank or lender. People do this to get better housing loan rates offered by the new lender.
It’s beneficial for those who want lower EMIs and to save on interest. But keep in mind, there might be some extra charges for the balance transfer.
A home improvement loan is designed for renovating or repairing your current home. It covers expenses like painting, plumbing, and electrical work. It’s a smart choice to avoid using your savings, but remember, these loans often have higher interest rates compared to other home loans.
Besides the mentioned home loan types, there are additional features to consider. Some lenders offer a top-up loan, an extra loan on top of your existing home loan. Use it for home renovation, education, or medical expenses.
Another option is a loan against property (LAP), secured against your property. It’s ideal for larger amounts needed for an extended period.
This is a government program that offers affordable housing to economically weaker sections. The Credit-Linked Subsidy Scheme (CLSS) within PMAY provides reduced interest rates on home loans for first-time homeowners. By using this scheme, you can save up to Rs. 2.67 lakh by using this scheme. Also get an extended loan tenure of up to 20 years. To avail these benefits, choose a lender registered under PMAY if you’re a first-time property owner.
A home loan is a significant and long-term financial commitment. Take the time to research and compare different types of home loans will ultimately lead to finding the perfect fit for your financial goals and aspirations. Explore OsianDiya Realty’s ongoing project, Estrella 45 offering luxury 2 and 3 BHK homes in Baner . Discover the perfect blend of luxury and comfort, designed to fulfill your aspirations of owning a beautiful home.
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