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HOW TO MANAGE YOUR HOME LOAN WISELY?

Posted on Monday November 16th, 2020

Owning a home is a dream of every individual and home loan acts as a financial tool that helps one to turn their dreams into reality. However, it is exciting to buy a new house but many end up making mistakes in rush. These mighty mistakes include choosing a wrong lender, unable to understand the terms and conditions, distorted budget plan which is not suitable. It just can cause a lot of stress and financial burden in future if not managed properly. Let’s know about some factors to make your borrowing experience more joyful.

⇒ Manage the Finances: Paying any loan is a commitment so you need to manage the finances well. For such purpose, you need money management skills and financial awareness. Just keep in mind to make a budget and stick to it every month. Moreover, try to save more and track your spending. If you have any investment plan without any profit, you should close it and focus on paying your Home Loan first.

⇒ Ascend up the EMI: However, large EMI may look scary but it will end up in paying your loan faster. The another thing to understand that you may not be aware of, paying low EMI results actually in paying more at the end of loan tenure. To plan your EMI according to your budget, you should use the Home Loan EMI calculator. This will tell you how much you will be paying at the end of the repayment period. It will also help you to save on interest rate.

⇒ Pre or Part Payments: Although home loans are offered at a lower interest rate but still it ends up consuming nearly double of what you borrowed. As mentioned above, it is always better to end up your loan as soon as early you can. You can opt partial or pre-payments whenever you have sufficient funds in your pocket. One can also do with their investments such as fixed deposits, mature RDs. It will either help you to reduce your monthly installments or repayment period. Hence in both cases, you will be saving the interest charges.

⇒ Refinancing: It basically means transferring the outstanding loan amount of previous borrowed amount from one lender to another to get a lower interest rate or flexible tenure options. It is the viable tool to reduce the burden of monthly installments. If any borrower comes across a new lender who is offering lower rate of interest, then he/she can sure reduce their EMI burden to greater extent when going for a balance transfer. If your outstanding amount is too small then it is not advisable to choose Home loan balance transfer because it may end up paying a similar or higher amount as compared to current loan.

There are numerous financial institutions and lenders available in the market to approve your loan. When you Apply For Home Loan it’s your sole responsibility to manage it properly. Therefore, always find suitable deals because a careful decision can lead to getting advantageous fruit for you.


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HOW SOME FACTORS AFFECT THE LOAN AGAINST PROPERTY ELIGIBILITY

Posted on Monday October 12th, 2020

The major decisions in life like wedding, education and constructing a house etc. require a great deal of money. There are number of ways to fund these requirements and one of them is to get a loan against property which can be availed by mortgaging property. It is popular among borrowers due to its various benefits and easy processing. The fulfillment of certain criteria is required to be eligible for a loan. Let us examine how some factors affect the loan against property eligibility while borrowing.

→ Age of Applicant: It is one of the most basic eligibility criteria to consider while availing a loan as it determines your repayment capacity. If the applicant is above 60 years old or getting retired soon, the chances of rejection of the application increases. It is always advisable to go for shorter tenure or get co-applicant to avoid missing EMIs.

→ Employment: The professional status and job stability are the key factors for any individual to sanction a loan for all the lenders. The number of years, one is associated with the firm and the monthly salary is assessed to ascertain the borrower’s capability to pay back the loan. If you are prone to switching the jobs, it can leave a negative impact on your financial stability and the chances of approval get decreases.

→ Source of Regular Income: A stable and a sufficient source of income is the important criterion for a lender to sanction an application. The borrower should maintain a stable job or business to earn a stable income if he/she want to Apply For Loan against Property as it determines his/her ability to repay the loan. In case, if the loan EMI exceeds 60% of the monthly income of an applicant, the application gets rejected.

→ Credit Score: This score reflects how effectively a person has been paying his existing EMIs and credit card bills. Most of the lenders look at an applicant’s credit history before approving a loan. Any defaults on the existing loans or late bill payments are reflected in your credit report and can impact your loan application.

→ Slips of Income Tax Returns: However having a stable job and high monthly salary is good but insufficient ITRs can also lead to rejection of loan application. The slips of Past ITR for last 2-3 years ensure a steady flow of income and increase your chances of approval.

→ Property Papers: Either you Apply For Loan against Property Online or offline, the submitted property documents should needed to be authentic and valid. The basic property documents include registrations, building plans, permissions etc. If the property involves some legal turfs or the papers are not in proper order, the application is likely to get rejected.

If these following factors are taken care of and one respects the responsibilities associated with it, loan against property is one of the easiest option to tackle your financial needs. ShubhBank offers competitive rates of interest, flexible tenure, convenient EMI options, low processing fees and hassle free processing on loan against property.


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IN WHAT CIRCUMSTANCES YOU NEED TO BORROW MONEY?

Posted on Wednesday October 7th, 2020

Every person has different notion of borrowing, some might consider it ok to borrow money for short term as well as long term goals whereas some might be strictly against any sort of borrowing. However, in certain situations of life, we have no other option than to avail a loan. The misconception about taking a loan is not good for your finances couldn’t be ignored. The loans can help you in number of ways such a growing your business, get your child higher education; help you to buy your dream home or to invest in attractive business opportunity. However, if loan is not used correctly, it could trap you in vicious debt cycle. So here are some points listed in what circumstances you need to borrow money and there is no harm in it.

→ Medical Emergencies: An emergency can arise uncertainly, therefore, it is tough to be prepared if you are caught off-guard. If you don’t have any medical insurance to cover your emergency, then borrowing money is inevitable. Several lending institutions offer personal loans to help you take care of medical emergencies without worrying about huge bills of the hospital. However, do check the terms and conditions of the loan before borrowing it.

→ Higher Education: If you are worried about child’s future education, a loan against education could be an excellent option if you don’t have adequate savings. Most of the banks and NBFCs in India provide education loan to help the children fulfill their dreams. The financial institutions not only offer the lower interest rate when you Apply For Loan but also have longer repayment period.

→ Expanding Your Business: If someone wishes to grow their existing business, borrowing money might be a best option, if you are short of funds in account to fuel your expansion. With the easy cash flow in operational units, you can grow your business by leaps and bounds which can lead to increased sales and higher profits. Therefore, have a robust business plan to reflect the lender that how you want to use the loan money to expand your business with minimal risk.

→ Consolidating existing loan: You have taken multiple loans in past years and unable to manage them, then gold loan might be a good idea to avail a loan with high amount to pay the existing loan. The gold loans are offered on lowest possible interest rate that can save you money if you are paying higher interest rates. It not only helps to consolidate the loans but also helps to manage your debts better.

Now we have touched upon few circumstances why people might borrow money. Before you Apply For Loan Online do your homework by comparing the different lenders on internet and keeping in mind the different aspects of loan that how much money you really need and how much money can you comfortable repay in a decided tenure. A loan can turn into messy financial challenge if you mismanage it, so beware of your deeds.


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HOW TO MAKE YOUR HOME LOAN EXPERIENCE BETTER?

Posted on Friday October 2nd, 2020

It is important to find a perfect home, but finding an ideal home loan is equally important too. There are innumerable lenders in the country that will be willing to lend you money against home loan but the important thing to decide is who should you borrow from? Every housing loan you zero in will require your financial commitment for a long run. Therefore, we have mentioned some tips for you that tell you how to make your home loan experience better as it is one of the biggest financial decision of your life.

Save early for the down payment: It is crucial to plan your finances before taking a home loan. You should lay out a monthly budget first and start saving a certain amount of cash that can help you to pay down payment. The down payment is the 20% of the purchase price of the home depending upon the home loan and lender you choose.

Maintain your Credit Score: A good CIBIL score attracts a great deal on home loans as it reflects your creditworthiness to the lender and for that you must have a good financial history. Keep a check on your credit report; get a copy of your credit history to see how your credit profile looks like to the lender.

Hold your financial documents in place: While you Apply For Home Loan you need to provide number of financial documents to the lender. These documents needed to be ready beforehand because it will help you to accelerate the processing of your home loan application. These documents may include last 6 months pay slips, tax returns and bank statements depending upon the requirements asked by lender.

Compare the various lenders: Don’t be fooled by the lending institutions offering lowest interest rates. There are some other facts like processing fees, hidden charges etc. that can make home loan more expensive. It is advisable to check all the aspects of home loan charges so that it can be easy on your pocket and makes your loan journey stress-free.

Use a loan calculator: When you Apply For Online Home Loan or research for various lenders, there are numbers of lending websites having an important tool as loan calculator which help you understand how much you can afford. It enables you to calculate your monthly installment with different home loan rates, down payments etc. You can use it to determine that how much you should be borrowing considering your earnings.

Read the terms and conditions carefully: While signing the documents for home loan, make sure to read each and every clause written in the home loan agreement. The terms and conditions applied in agreement must be read carefully before signing any document.

Always observe the above mentioned tips while you apply for online or offline home loan. Don’t be hurry for any decision making, check your loan eligibility criteria with lender and get the deal that best suits you and makes your home loan experience better and hassle free.


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WHAT ARE THE ESSENTIALS OF LOAN AGAINST PROPERTY?

Posted on Wednesday September 9th, 2020

Loan against property is much like any other type of loan in which lender promises you to give the funds by keeping your commercial or residential property as collateral. This concept is gaining popularity among loan seekers as large sum of money gets easily arranged by this. Loan against property offers great features such as easy documentation, faster approvals and flexible repayment options. It means one can apply for a loan from any lending institution by extending his/her property as a security. This is type of mortgage that involves a ‘transfer of interest’ and the ownership of the collateral remains with the borrower. Here in this article, we will tell you about what are the essentials of Loan against Property and why it is attractive as compared to conventional loans. Mortgage loan is convenient as it offers higher loan amounts at discounted interest rate accepting both residential and commercial properties as security. Its major benefits are:

• Large quantum can be financed.
• Lower rates of interest as compared to other loans.
• Longer tenure resulting in low EMIs.
• Efficient financial tool for debt consolidation.
• Multipurpose use either personal or business.

The lender may also ask for KYC documents to validate the eligibility criteria which may consist of:
• Address proof.
• Identity proof.
• Property Papers(Residential/Commercial/Industrial/Plots).
• Salary slip if you are salaried.
• Certified financial statement for last 2 years if you are self-employed.

The approval of loan depends upon borrower’s credit score along with other factors such as age, income, the number of dependents, assets and liabilities. Once you Apply For Loan against Property the lender will evaluate your eligibility depending upon given factors and luckily, if get approved for loan, the amount is disbursed in full or in installments in the bank account of the borrower. One can have choice to pick the type of interest rate either fixed or floating. The quantum of loan extended to the borrower is evaluated on the market price of the property, you pledged to the lender. It is important to keep the fact in mind that every lending institution always holds a certain amount of money and disburse a maximum of 70% of the market value of property. This ensures the lender against any cyclical fluctuations is real estate prices or in case, borrower default on installments.

Loan against property is great financial tool to meet your personal and business needs as there is no restriction on its usage. Many people use mortgage loans for funding children education in abroad, to buy or build a second property or even for business purposes. Putting your property at stake is a serious decision, so go ahead for loan after comparing the different lenders on their websites as many of them offer online loan against property with great benefits and features. The LAP should not be used as risk capital because it has high chances of losing your property to lender, therefore, apply it only when you know that you are able to pay back the loan amount in the fixed period.


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SOME SMART WAYS TO PREPAY YOUR HOME LOAN

Posted on Saturday August 22nd, 2020

Owning a home is something special that all people tend to with their hearts. It is one of the biggest investments of life where you will end up spending most of your time as your family will grow in it and so will you. Every rich and poor wants to have their own house and to get so, they opt to choose a home loan to fund such big purchase. Taking a home loan is easy and convenient but it is more important to clear it as soon as one can. You can’t spend your half of the age in paying back the home loan. Here, we have discussed some smart ways to prepay your home loan and it will be possible if you plan well.

• Choose a loan with part payments: When you receive a loan initially, it is based upon your income and credit score but over a period of time, your income will increase and in turn your affordability. If you have taken the loan for the maximum tenure, you are allowed to repay more over a period and finish it off before tenure. Always check for the lenders that offer pre-payment feature that you can pay more than the EMI when possible.

• Change your installments amount as your income increases: Every person in their life grows their career and so does their salary. Make sure that you must increase the loan installment as your income increases which will reduce the interest rate efficiently. At that point, lender will help you in reconstructing your loan as per current salary of yours resulting in strengthening of your creditworthiness.

• Always aim at prepaying the loan: When you plan to Apply For Home Loan you must set some money aside to make the down payment. If you take a loan with prepayment features, then divide your investments accordingly. Everyone has specific goals regarding their investment plans so clearing a home loan should also be one of them.

• Invest in SIPs to prepay the home loan: If you start investing in mutual funds at early age, you can accumulate a great quantum over a period of 10 years or so. You can use the chunk of money from these funds to clear off the considerable amount of your home loan before the tenure ends. Investing in SIP’s also helps you to save on taxes resulting in double profit.

• Use your other income sources towards the prepayment: There are great chances of acquiring other sources of income either a rent of property or other variables from work area. This extra income can be directed towards prepaying the loan.

A smart tip to Avail Home Loan is to start your search wisely and prepare yourself for good amount of down payments. Nowadays online home loans are popular in lending market which offers you doorstep services, customer support and you can also check your credit score also. Always remember prepaying your home loan not only relieve your financial burden but also gives you the space to plan for other financial investments.