As the lockdown resulted in grave economic fallout, we saw Banks and NBFCs slash interest rates on various loan products. One such product is Home loans. Rates have shown a sharp fall to 7.00% and below making Houses affordable and worth dreaming!
But wait, before you could pounce on this opportunity, ask yourself these 5 questions to ensure that you are prepared enough to seek a Home loan.
- Is your job secure?
When planning to buy a house, most of us go for the 80:20 method paying 20% as a down-payment and the rest in EMIs. But repaying isn’t easy especially when you don’t have a stable source of income.
A secure job is one of the eligibility that grabs you a good loan deal as you appear more promising to the lenders. With the current situation and job market being unpredictable, there is no telling when one can lose their job. Hence consider this before you opt for a home loan.
- Have you defaulted during this lockdown?
This is a valid question that one must answer. Have you defaulted during this moratorium period on any loan EMI or credit card bills? If you have repaid the bill/EMI late or opted for the moratorium, this means you’re not ready to take on such a big loan with minimum reserves.
- Do you have a contingency fund?
Are you ready to battle any form of emergency like medical/financial? Emergencies arrive at any point in time. In these situations funds are needed. If you have a dedicated fund for emergencies, then good for you. If there’s no special fund, then you will end up using your savings. Post that, how will you be able to repay your home loan EMI?
- Can you afford 20% of down-payment?
A house in metro cities can cost anywhere between 30 lacs to 2-3 crores. When you opt for a home loan, you will have to pay around 20-30%* of the loan amount as a down payment. Gauge your affordability before taking a step that might land you in a mess.
- Do you have a working spouse/partner?
One of the most practical ways to go ahead with home loans is having a working partner/spouse. This will help you share the EMI burden and you can repay the loan quickly. What’s even better is that you and your spouse can get tax exemptions up to 1.5 lakh each on principal repayment as per Section 80C.
We sincerely hope you answer these 5 questions as post this, you will be clear with your decision of buying a home. If you are looking for the best home loan in India, you can apply on our website as we have the best deals available for you.
Contact Ruloans for the best expert advice as we help you borrow right!