If you are planning to buy a new home but don’t have the required funds, a home loan is a good choice to get your dream home. There are a lot of lenders and banks that will give you the option of hassle-free home loans that meet all your home goals, be it renovating or purchasing a new house.
Types of Housing Loans
Housing loans aren’t just for buying a new home. You can get a house loan for renovation, repairs, and even reconstruction of your residential property. PNB Housing Finance offers various types of housing loans so that you can make your dream home a reality.
New Home Loan
This type of home loan is ideal for new home buyers. You can take this loan to buy new or second-hand property.
Home Construction Loan
If you’re planning to build your home from scratch, this is the loan type for you. You need to provide proof of land ownership for getting this loan.
Home Extension Loan
This loan is for extending your home to make it multi-storey or expand it from the sides to add more room to your house.
Home Improvement Loan
A home needs constant care and repairs to keep it running smoothly. If you want to undertake repairs in your home or renovate it, you can avail a home improvement loan. Improvements can include repairs, tiling, touch-ups, or electrical and plumbing work.
Eligibility Criteria for Getting a House Loan
Anyone who owns a property or has plans of rebuilding their existing residence can get a home loan at PNB Housing Finance. However, to get a home loan you need to meet certain eligibility criteria.
- You need to be between 21 to 70 years of age.
- You should have a stable source of income.
- If you want a reconstruction or renovation loan, you should have ownership of the residence you want to improve.
- You need to possess valid documents, such as age proof, identity proof, and property documents.
You can use the home loan eligibility calculator to understand how much interest you will pay against your loan and get an idea of your repayment EMIs.
Tips for Choosing a Housing Loan
You can get a house loan easily with the right documentation, but there are some things worth considering when you choose a home loan.
When you get a home loan, you are charged an interest on your loan that you pay back along with principal in monthly installments or EMIs. Most lenders offer competitive interest rates for housing loans. Interest can be of two types:
A fixed rate means you pay a fixed percentage of interest on your loan amount. Fixed rates are generally 1-2 % higher than floating rates, since they stay the same throughout the duration of your loan.
A floating rate is based on the current inflation and property market, which means your interest rate changes annually. The interest charged in floating rates is generally lower than for fixed rates but they can go up later if inflation increases.
Another important consideration is the tenure for which you will repay your housing loan. When you get a loan, the initial EMIs are towards interest payments and as the loan matures, you start paying back the principal. You can calculate your loan principal and interest rate to determine how much EMI you will have to pay. Compare this EMI with your income to get a better idea of what your loan tenure should be. Some lenders offer a home loan tenure of up to 30 years. A longer tenure loan means less EMI.
Processing and pre-payment charges
A loan always comes with processing charges. These are your loan processing charges and any other expenses related to assessing property value or verifying other property details.
Lenders often charge a prepayment fee towards the early repayment of your loan. Prepayment charges are applied only in the case of floating interest rates and not fixed rates.
Choosing the right housing loan is simple if you know what you are looking for. You can get a loan for anything from decorating or renovating your home to buying a new house. And you can use the home loan eligibility calculator to make an informed decision about the EMI for your loan against your income ability.