Be Prepared for a Home Loan

Everyone wants to buy a house these days, if not as a home for them to stay in, then at least as an investment for the future. But let face the facts - very few people can afford to buy a house outright. More often than not, people end up paying for the house through a loan. And this is what you need to prepare for. And this also depends to some extent on the house you intend to buy for yourself - things like the size of the house, the locality of the house and facilities available near and in the house all factor into the price of the house. More than likely you'll have to pay around 20% to 25% of the total transaction value when you're booking the flat. The rest of the amount can be taken out as a loan and you need to decide whether or not you can afford it. For this, you need to take a careful look at your finances and decide how much of your income and savings you can shell out for this house.

One thing you can do while you're checking on the financial aspect of the loan is using a home loan calculator. Generally, there are online calculators that can help you to sort out how much loan you're likely to get based on both your income and your liabilities. There are also calculators that help you to identify how much you'll have to pay as EMIs once you've got the loan approved and the time has come for repayments on the home loan. You can even calculate all of these matters if you've got a co-applicant for the loan. And frankly, the chances of you getting a loan are higher when you've got good credentials and a higher income and lower liability. Once you've decided how much you can shell out in terms of money, you need to zero in on a house within that price range. You might think that house hunting takes a while, but processing the paperwork for a home loan takes longer. So you want to do all that you can to get yourself ready for it, even as you're hunting for a home.

Look into what the application process is for a home loan. You should know that after getting a loan approved, the loan disbursement can take anywhere from a week to 10 days. But it can either increase or decrease depending on how many applications the bank will have to process at the same time.

Arundhati is a veteran author in banking and finance. In her posts she helps her readers find all the latest trends in finance market and also help them analyze loans for your needs, budget planning, etc.

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