Yesterday while watching TV, a commercial caught my attention. The commercial was by Aditya Birla Finance Home Loans - Know Your True Worth. The advertisement emphasized how you should find your true worth as a borrower for property purchase. In layman terms, home loan eligibility value should reflect the true worth of an individual. It helps the borrower to buy the dream house of his/her choice. Take a look at the commercial below: https://www.youtube.com/watch?v=rzq89PNXkRM In the past, I have shared a couple of posts on home loan eligibility value. In one post, How Home Loan Eligibility ... Read More
Revised Guidelines on Home Loan from HFC
It's all over for small HFC's (Housing Finance Companies). As i highlighted in my posts Home Loan from Housing Finance Company and Subvention Schemes that higher Loan to Value ratio and Subvention schemes were 2 critical USP's of the HFC's. In comparison to banks, potential borrowers preferred HFC / Housing Finance Company because of higher home loan disbursement. It was also beneficial for builders as HFC's were disbursing substantial Home Loan amount upfront to the builders under subvention schemes. RBI already banned subvention schemes for banks. HFC's are governed by NHB therefore they ... Read More
Home Loan from Housing Finance Company
Home Loan from Housing Finance Company, Regular readers of my website must be confused. I always suggest my readers to avail Home Loan from banks like State Bank of India, ICICI Bank, Axis Bank etc. The main reason is benchmark rate for calculation of Interest Rate. On the service front, almost everyone is at par i.e. below average :). Home Loan of Housing Finance Company is linked to benchmark rate known as BPLR / RPLR / PLR whereas Home Loan of a bank is linked to Base Rate. Base Rate is more transparent & beneficial for a borrower in a long run. I explained it in my post, Floating Home ... Read More
How to find out Right Home Loan Amount?
What is Right Home Loan Amount?. There is no right or wrong answer to this question. Both under borrowing and over borrowing are dangerous for financial health of an individual. We cannot ignore this question because it directly impacts your interest outflow. Three important pillars of Home Loan are Monthly EMI, Home Loan Tenure and Home Loan Amount. All 3 are interlinked to each other. I have not included Interest Rate as Interest Rate is not in control of a Borrower and is fixed. EMI, Tenure and Home Loan Amount are variable and optimum mix can be calculated. To influence any of these, ... Read More
Composite Loan – Two in One Home Loan
Composite Loan is a mix of Land Loan and Construction Loan. It is not very popular jargon in Indian Mortgage Industry. One of the reason is scarcity of land in big cities i.e. buyer prefer flats in big cities. The concept of independent house or villas is more relevant in small cities due to availability of land. As i promised in my last post that next post will be dedicated to composite loan. Yesterday i visited one of the leading PSU Home Loan provider to get some clarity on Composite Loan. Whole branch took 45 mins to understand what is Composite Loan. Loan Manager of the branch called ... Read More
7 Facts You Should Know About Land Loan
Land Loan or Plot Loan (used interchangeably) is one of the most confusing subject for borrowers in Loan / Mortgage segment. Confusion is normally between Home Loan, Land Loan and Composite Loan. All three are different products with different features, benefits, Terms and Conditions. Unfortunately all three i.e. Home Loan, Land Loan and Composite Loan are loosely referred as Home Loan only. At macro level, Land Loan is sanctioned only for purchase of residential plot or piece of land. Composite Loan is Land Loan + Construction Loan i.e. to complete construction on plot. In most of the cases, ... Read More