Doing anything first-time may bring a mix of excitement as well as challenge and the same is true when dealing with your first home purchase/real estate market.
It becomes more of a challenge when you decide to purchase your first home using a home loan as you need to repay it over a tenor which may affect monthly finances.
However, if you are aware of some tips about what you are dealing with, you will come out with an amazing home at the end.
This post talks about various tips that a first-time home buyer should be aware of in the form of a short Home Loan rules and regulations. Here are few guidelines given below.
Home loan guide – Checklist for First time Home Buyers
1) Know your Needs
The first thing that you need to know is your needs – what type of property you are willing to invest in? Will it suit the needs of your family? Do you have the required home loan eligibility and repayment capacity to afford such a home? Ponder over these questions before starting to look for a property so that it may fit your budget.
2) Define your Budget
The budget of your first home should match your monthly income and should complement the home loan EMIs that you would need to pay for a tenor. Thus, based on your repayment capacity, you should determine a budget and go ahead. Don’t look for a property who EMI payments may upset your monthly finances and you may land in a financial soup.
3) Finance your First Home Smartly
As you need to involve a financing company to fund your home, you should analyse the market and home loan interest rates offered by multiple banks and more. It is because choosing a right lender will have a bearing on your monthly finances for a long time. Thus, you should look for a lender offering online services like home loan application, penalty-free prepayments and foreclosure, online account access and more. Compared to banks which may have strict lending terms, it would be better to opt for a home loan from a non-banking finance company (NBFC) to enjoy benefits.
4) Arrange for the Down Payment
Since no lender will approve the entire value of your home that you intend to buy, you will need to arrange a down payment between 10-20% on your own. Thus, you start arranging for it even years before you think of buying your own home. Also, putting a large down payment will also help you reduce your loan principal. It will let you pay lower EMIs in the future helping you streamline your monthly finances.
5) Keep your Documents Ready
You should also keep all your documents related to purchasing of the house and acquiring the loan. It will also ensure that you don’t waste time in procuring the documents when needed the most. Also, you should ensure that you have done all the legal formalities involved with the home purchase. You should also insist on having a valid contractual agreement.
6) Meet an Expert
Even if you have collected many relevant inputs as the home loan guide on your first-home, there are still chances of making mistakes. Hence, you should not take risks in this regard. Thus, make it a point to meet a real estate cum home loan expert who can make you aware of all the minute details.
The Bottom Line
Finally you are aware of RBI guidelines for Home Loan, you can apply at top NBFCs or banks. The discussed house loan guide for first-time buyers must have given you the confidence to grab a home using a home loan smartly.
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