A home/housing loan, also known as a mortgage, is an amount of money borrowed by an individual, usually from banks and companies that lend money. The borrower has to pay back the loan amount with interest in Easy Monthly Instalments or EMI’s over a period of time that can vary between 10-30 years depending on the nature of the loan.

home loan that suits your needs

You can take home loans to buy properties that are either commercial or personal in nature.
Here are some of the different kinds of home loans you can take.

Home Purchase Loan

You can buy any house or home that is within your budget
Construction Home Loan You can use this loan to cover the costs of building a house

Land Purchase Loan

You can use this loan to buy a piece of land

Home Improvement Loan

You can use this loan to renovate and improve your house.

Home Repair Loan

Pay for the cost of repair and restoration of your home

Home Extension Loan

Increase the amount of built up space at your home using this loan.

Tax Saving through home loans

Interest charged on home loans is tax deductible, meaning you can claim the expenses when you are filing income tax.

What happens if you cannot repay the loan?

When you take out a home loan, the bank or financial institution accepts the property you are purchasing as a security. This means that it retains the legal right to the property in the event of non-payment.

Important factors to consider when applying for a home loan

Principal

This is the amount of money you will be borrowing from the bank or financial institution.

Duration

How long you will be paying back the loan. Depending on the nature of your expected income, you can select a period that suits you.

Interest

The bank or financial institution charges interest in exchange for its money lending services. The rate of interest is dependent on the amount of the principal and the duration for which you will be repaying the loan.

Amount

You will be paying monthly instalments for the duration of your borrowing, until the end of the loan period. Each EMI is a combination of principal + interest. With each EMI, you will be paying back more of the principal and costs of interest will gradually reduce.