With real estate market trends in Kochi showing an upward trend, most people prefer to avail home loans for purchasing property. However, getting a home loan is just half the battle. It is important that you pay your EMIs in time and free yourself of the loan burden as quickly as possible. Here are some tips :
Research Your Options Thoroughly
Use a home loan calculator to determine your EMI and check if it’s affordable for you. Secondly, compare lenders – the interest rate, amounts offered, down payment asked for, LTV ratio, tenure, processing fees, and so on. Compare all the factors and then make your decision. It is also necessary to check the reputation of the lender with regard to service – ask people who have borrowed. Continue to search even after finalizing your home loan and negotiate with your lender for more favourable payment terms.
Get A Co-Borrower
Rather than have the loan in one person’s name, get a co-borrower; it could be your spouse, sibling, partner, or parent (provided they are below 70 and are earning). This enables joint ownership of property and also gives you tax benefits. You can claim deductions under Section 80 C of the IT Act, up to Rs. 1.5 lakhs each.
Try for a Lower LTV
This is one of the most essential things to know before getting a home loan. Our basic tendency is to go for the maximum loan amount. Instead, try for the lowest LTV that you can afford. Let’s say the lender is offering 80% LTV, but if you actually need only 70 or even 75%, it is better to go for that instead. The lower the loan amount, the lower your EMI and total interest that you end up paying. A lower LTV will also help you to improve your credit score.
Leverage Banks’ Flexibility
Banks can be flexible when it comes to payment terms, so take full advantage of that. Of course, the better your credit score and history, the better your position to negotiate. Check for factors like prepayment penalties, administrative costs, flexible payment modes, moratoriums, balloon payments, and more. Make sure to read all the fine print, ask questions, and make comparisons.
Get Better Deals
Sadly, most people don’t think of asking for better deals and so end up not getting the best deal. With a good credit score, low debt, and high income, a borrower is a boon to banks, and they will be more than happy to lend to you. This puts you in a great position to ask for flexible EMIs, good rates, tenures, and so on.
Choose Higher EMIs
Take as high an EMI that you can afford; while you may have to curtail your extra expenses, high EMIs will reduce your interest burden and allow you to pay off your loan sooner, so that you can be debt free.
Make Part Payments
Whenever you have extra funds, make part payments, as this will directly reduce your principal amount. This in turn leads to lower EMIs and reduce the overall interest you pay on your home loan. The EMI includes interest also, and hence the amount may not reduce significantly, but there will be a reduction, and the loan can be paid back sooner.
Refinance
Even a few months into your home loan, you can transfer your loan to another lender if you get a much better deal. By refinancing or dong a balance transfer, you can reduce your interest burden, EMIs, or shorten the loan period.
Conclusion
Thanks to the easy availability of home loans, people can now afford to buy more expensive homes, and this is one of the reasons for the growth of luxury flats in Kochi. With the right home loan, you can now own your dream luxury apartment. Varma Homes has some of the finest luxury apartments you can buy in Kochi. Their premium 2 and 3 BHK flats are located in the best residential localities of Kochi and feature world-class amenities.
FAQs
How can I negotiate a lower home loan interest rate in Kochi?
To negotiate a lower home loan interest rate in Kochi, start by maintaining a good credit score and having a stable income. Research various lenders and compare their rates and terms. Approach your preferred lender with this information and request a rate match or a better deal. Highlighting your strong credit profile can also enhance your negotiation leverage.
What are the benefits of having a co-borrower for a home loan?
Having a co-borrower for a home loan offers several benefits, including joint ownership of the property and potential tax deductions under Section 80C of the IT Act. Additionally, it may increase your eligibility for a higher loan amount and potentially lower the interest rate, as the combined incomes can improve the lender’s confidence in your repayment ability.
Is it possible to refinance a home loan in Kochi to reduce EMIs?
Yes, it is possible to refinance a home loan in Kochi to reduce EMIs. By transferring your loan to another lender who offers a lower interest rate, you can decrease your monthly payments and save on interest costs over the loan tenure. Refinancing can also allow you to modify the loan terms to better suit your financial situation.
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