How Reasonable Home Loans can Help you Become a Homeowner Before 30
Today, the increase in real estate prices make it very difficult for many households to purchase their dream home. To combat this existing problem, home loans have emerged rapidly in India and are there to finance the need for a house for many individuals. How it works is that the property is kept as a mortgage with the bank or non-banking financial institution until the loan amount is repaid. Upon the completion of the monthly EMIs, the borrower will be held at the title deed of the house. Due to all these reasons, it is now quite convenient for an individual to become a homeowner before the age of 30.
Home loans in India can not only be availed for the purchase of a house, but they are also increasingly used for making renovations of the house. Let’s take a look at how taking reasonable home loans can be a great advantage for many individuals.
1. Great Tax Benefits
Today, the Government of India provides great tax deductions on the principal as well as the rate of interest paid on home loans to encourage more and more people to buy their dream house. A borrower is allowed to claim a deduction of Rs 1.5 lakh under Section 80C of the Income Tax of India 1971 Act, in a single financial year. There is also a deduction of Rs 2 lakh allowed but one can’t claim it while the property is still under construction. In case of a second house, an individual is eligible to claim deductions for the whole housing loan rate of interest under Section 24B of Income-tax Act.
Unlike other loans where lenders charge prepayment penalties on payment made towards home loan, there are no prepayment penalties on floating rate home loans . So, whenever you have surplus money, you can utilize it for making part payment towards your home loan and lower your burden. However, there will be prepayment charges in case of floating rate home loan.
2. No prepayment charges
In home loans, there are zero prepayment penalties on floating rate home loans - unlike other loans where financiers charge heavy prepayment penalties on payment. Hence, whenever an individual has surplus money, they can utilize it for making part payments and lower their burden towards home loans.
3. Long repayment tenure
One of the biggest advantages of a home loan that makes it stands out from the rest is its high repayment tenure - which can go up to 30 years. Hence, one has the luxury to reduce the burden of the monthly installments by extending the tenure. This also ensures that the finances are handled smoothly and it won’t disturb other expenses of the individual.
Wondering how to get a home loan? Well, thanks to the constant advancements and competition in the financial sector, there are many financial institutions providing hassle-free home loans. Many banks and NBFCs also offer various deals and offers to the customers due to the vast competition, which is a major advantage for borrowers. It’s essential to do proper market research before deciding on the right financier for your house. One of the best home loan providers is a digital NBFC called Clix Capital - which provides easy loans with fast approvals and minimal documentation.
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