Hyderabad: Purchasing a house is one of those life accomplishments that tops everyone's wish list. In order to fulfil it, we search for a bank, which would grant home loans with low-interest rates. But, with a good CIBIL score only we are bound to get loan approvals on a fast track.
A number of people prefer to buy homes as banks are offering home loans at a low-interest rate. In this backdrop, a lot of people have doubts about how to get loans to their needs. What are the factors that a bank or housing company will consider when giving a loan to an individual? Let's try to find out what precautions the borrower should take to increase his eligibility for getting loans.
The CIBIL score is vital
Credit Information Bureau (India) Limited (CIBIL) score plays a critical role in the loan approval process. The higher the score grater is your chances of loan approval. lIf you want the speedy approval of loans you have to improve your CIBIL score. Credit card bills and EMIs must be paid on time if you want a good score. Delay will damage the CIBIL rating and it is better to have a score above 750.
If more than two members of a family are earning, it is better to apply for a joint loan. This results in a higher amount. This joint loan can be taken together with the spouse and parents. In addition to increasing creditworthiness .. EMI can share the burden. It is useful for an income tax deduction.
Duration can be increased
When a large amount of loan is required make sure the duration is as long as possible. This will reduce the EMI burden and increase your debt. Do not forget that this will increase the interest burden.
Disclose income from other sources
Income from other sources is also crucial in determining housing eligibility. If you already have obtained two or three loans, it may become a barrier to taking new loans. So, try to pay off small loans. Having EMIs above 40 per cent of income is not good, but it is better to have below that.
If the income comes from other sources you should inform the banks from where you are wishing to take the loans. For instance, if the income comes from rent, business and agriculture show those details. This makes it possible to receive a higher loan.
High-interest rates on low CIBIL score
Now a new generation of housing companies has arrived and they are granting loans to those who have do not have good CIBIL scores, but with high-interest rates.
Pay more to lessen the burden of interest rates
Banks and lenders usually lend up to 75-90% of the value of the home. We have to provide the rest ourselves. If you pay low margin money .. you will have to borrow more. The burden of interest must also be borne. Rather, pay as much as you can and borrow as much as you need.
In the rush to get home loans quickly, we forget some key points. Decide which bank/loan company to contact first. See how much interest is to be paid. Check for any errors in your CIBIL report. Find out more about inspection fees and other fees. Only then proceed.
Also read: Know how to check your CIBIL score for free
