One of the many life goals that a majority of individuals tend to have on their wishlist is purchasing their own home. However, considering the ever-rising real estate prices, you may need more than just your savings and investments to help fund your purchase. Here’s where a home loan comes into the picture. It can provide you with some much needed funds to make your dream come true.
That said, before applying for a house loan online, you must first ensure that the experience is smooth and seamless. And to help you do that, we’ve come up with 10 tips that can help you get the best home loan experience ever. Let’s begin.
1. Get to know your credit score
The first step that you need to take before you apply for a home loan is to check your credit score. Lenders usually tend to gravitate more towards borrowers with a healthy credit score of at least 700 or above. Checking your score before applying gives you enough time to take remedial measures to boost your credit score if they’re lower than ideal.
2. Keeps some funds ready for the down payment
Generally, lenders only offer loans that cover up to 80% of the house’s purchase price. The remaining 20% will have to be borne by you out of your pocket, in the form of a down payment. Therefore, it is a good idea to set aside the funds necessary for making the down payment beforehand instead of leaving it to the last minute.
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3. Collate all the necessary documents
When going through the home loan process, you will be required to submit a host of different documents. This includes your identity proof, your address proof, salary slips, Form 16, Income Tax Returns, bank statements, and more. Having all of them ready and in one place can help you get through the process seamlessly without a hitch.
4. Know what the interest rates are
The interest rate on a home loan is one of the most important factors you should consider. The lower the interest rates, the lower your financial burden will be. So, before you go ahead with a house loan online or offline, always make sure to first determine what the rate of interest is.
5. Make use of a home loan calculator
Once you get to know what the interest rates on a loan are, the next step is to find out just how much the monthly EMI payments are likely to be. Although you can calculate the EMI manually, it is advisable to use a dedicated online home loan calculator. They’re far more accurate and give you results within a few seconds.
6. Take a look at multiple home loan offers
The interest rate on a home loan can differ from one lender to another. Also, the processing fees and other charges may also vary. Therefore, it is important to compare multiple offers with each other. This way, you can make sure that you zero in on a deal that’s favourable to you.
7. Opt for a pre-qualified loan
Many lenders offer pre-qualified home loans. However, to become pre-qualified, you will have to first submit a host of documents to prove your financial stability and position. Opting for pre-qualified loans can help you speed up the home loan process considerably.
8. Be prompt with your responses to the lender
As part of the home loan authorisation process, your lender may have several queries or require you to submit clarifications and additional documents. Make sure to address them as quickly and with as much clarity as possible. Such prompt responses will be valued by the lender and can make the whole loan experience a whole lot better.
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9. Get to know the difference between multiple loan options
When it comes to home loans, there are multiple different options to choose from. There are fixed interest home loans, and there are floating interest home loans. It is very important to know what these two options are and how they differ from each other.
10. Keep your credit score healthy throughout
The home loan process can take a few days to complete. And lenders can check your credit score at any point in time during the process. Therefore, it is important to ensure that your credit score stays healthy throughout the process by continuing to follow good financial practices.
Following these 10 tips can make your home loan experience smooth and hassle-free. Here’s something you should know. When applying for a house loan online or offline, always remember to read the fine print. This way, you can ensure you make an informed decision.