This Is the Main Heading You Can Edit

The interest component in the Interest is calculated on a monthly reducing balance. This interest is adjusted in your EMI so the debit interest is not charged separately from you. indicates the price that is charged over and above the “principal” amount. The interest depends on the principal sum, interest rate, compounding frequency, and length of time over which it is lent or borrowed.

Interest rate is linked to the Benchmark Prime Lending Rate, also known as BPLR, which helps us ensure transparency and appropriate pricing. The rate of interest varies for different borrowers as our housing finance team considers various parameters such as credit score, borrower profile, loan amount, property type, and others.

Any loan on residential or commercial property can be used for both personal and commercial purposes. Banks usually do not ask you for details on where to use the loan amount. However, if you are going to use this money in your business, be sure to tell the bank as you can get a discount on the interest rate.

Basically, the bank sees your ability to repay. To calculate the loan amount, your income, age, qualifications, if you are going to take a co-borrower, their income, assets, liabilities, stability, continuity of business, and history of savings are taken into consideration. However, the eligibility of the loan, in general, does not exceed 60 percent of the market value of the property.

Your repayment schedule plays an important role in your home loan. Therefore, it is important to make the right decision and not be hasty about it. Here are the few modes via which you can settle your loan repayment:

Step-up repayment
This method involves the borrower starting his/her EMI payments with a smaller amount and gradually increasing them. However, this method involves the borrower paying more interest in the long term.

Step-down repayment
This mode of repayment involves larger EMI payments, to begin with, that gradually become smaller, allowing more of the payments towards the principal.

Prepayment
This method allows the borrower to repay the entire home loan, either partially or fully before the loan tenure. This reduces the EMI payments but might bring some prepayment penalties depending on the lender’s policies.

Late repayment
Some lenders might allow you an EMI holiday, giving you a temporary break from paying the EMIs. This allows financial relief during the initial stage. However, the deferred interest and EMI need to be paid later on.

Fixed and flexible installment plan
In a fixed EMI plan, your EMI remains constant for a fixed period. This ensures you are safe from market fluctuations if the interest is likely to rise. At the same time, in a flexible EMI plan, the EMI fluctuates as per the market. This method requires a change in EMI every month but offers flexibility.

Lump sum repayment
This method helps in fast-tracking paying down your home loan and is handy if you have a large chunk of cash and want to get rid of your debt as early as possible. Your payment will first be adjusted for the interest and then go toward the loan principal.

Balloon repayment
This type of lump sum repayment method, but your installments are scheduled at fixed intervals during the tenure.

Linking your loan and savings account
This can be a good way to reduce the interest liability. The higher the funds in your account, the lower the interest you owe.

You can take your spouse as a co-applicant and considering their income also you can get a maximum loan. However, if the property is co-owned, all co-owners must be co-applicants. Also, all the debtors in your debt should be of blood type.

The term of the property loan is a maximum of 10 years, subject to the condition that it does not exceed your retirement age. Repayment tenure of Mortgage Loan Against Property can be extended if the income from the business.

The processing fee for a loan on any property varies from bank to bank and is generally 1 to 1.5 percent.

You repay the loan in equal monthly installments (EMIs) with principal and interest. If you want to repay the loan early, you can repay it.

Typically, the repayment period starts once your home has started building or within one month of the home loan amount being disbursed. However, every lender might have their terms and policies for the same.

If the bank’s panel advocate suggested that the property is mortgaged by way of an Equitable Mortgage then the Original Sale deed and other original documents are to be deposited to the bank for the creation of an equitable mortgage. In case the Original Sale deed is not available then some banks accept certified copies of the sale deed but it totally depends on the bank’s decision. Bank may suggest for Registered mortgage also. If you want to know the Difference between Equitable Mortgage and Registered Mortgage then check this article.