Pre – Plan Your Home Loan
Pre planning is better than planning…just like pre-paying is better than paying!
Owning a house of your own is a life time dream for many of us. Undoubtedly the most common way of fulfilling and accelerating this quest is by availing a Home loan. It would be only correct to state that the first step towards fulfilling this dream should be preparing a “Check list”. It will certainly help you make the complete process easier and smoother for you.
Here are some suggested steps which you should ensure while planning your Home loan:
Step 1: Evaluate your Budget
Draw a budget sheet and evaluate your income, expenses and consider your contingencies and savings before you decide on the loan amount and therefore on your home! Be realistic in your approach…your loan should not end up being a burden for you in the event of unforeseen activities..
Step 2: Check your credit report and score
This is a rather unusual step! Many of us would have felt that this has to be done by the lender before they grant us the Home loan. Your credit report and score can decide the fate of your loan application and hence it would be nothing but wise to check your report and score.
Step 3: Choose your property
Before starting to search for the lender, you should probably search for the property that suits your needs, check if the said property is clear from any kind of legal disputes, if the builder has a good reputed track history and then go for it!
Step 4: Ownership title
Pre – plan the ownership of the property and also the borrowers for the loan. This is important from your Income Tax planning perspective and also the lending institution’s perspective to know your obligation towards this loan and to quantify your eligibility.
Step 5: Choose your lender
Features like rate of interest, type of interest rate i.e. Fixed or Floating, repayment options, other fees, etc. to a great extent play a role in the selection of the lending institution. Compare and evaluate the options but most importantly consider your own priorities and repayment capacity before zeroing down on any one of them.
Step 6: Read the Loan Agreement
This might be the last step, but definitely not the least!
Do not be in a rush to sign it. Certain terms in the agreement could have the potential to compromise you. This makes reading the agreement extremely important before committing to any of its Terms & Conditions.
These simple and easy steps could help you save a lot of your time and be your guide in pre – planning your Home loan! Don’t forget, it is a way your dreams will realize!!