If you follow real estate market trends in Thrissur, you know that it’s the right time to purchase property. The advantage of taking a home loan is that you can choose a property that ticks all your boxes. This means location, the standard of the apartment, amenities, construction quality, and more. However, you must always remember that it’s something you have to pay back, and so, must always find a way to free yourself of the debt as quickly as possible. Here are some guidelines:
Do your Homework
Even if you avail a home loan, you have to ensure that you are able to afford the monthly payments. It is wise to apply for an amount that you can comfortably pay back each month. You can check how much EMI you will have to pay with the help of a home loan calculator. You must also compare offers from various banks and financial institutions on the basis of tenure, interest rate, processing fees, LTV ratio, and more. It is also important to compare lenders in terms of service quality; read reviews and ask for referrals.
Reduce Your LTV
Though you may be tempted to avail of the highest loan amount possible, one of the things to know before getting a home loan is that you avail the lowest you can afford. The Loan-to-value ratio is the percentage of property value that banks will offer. They may offer 90%, but if you can afford to pay a higher down payment and only take say 80% LTV, that’s what you should take so that your debt burden becomes lower. Lower LTVs help you increase your credit score too.
Get A Co-Borrower
When you have a co-borrower, like a partner, sibling, spouse or a parent under the age of 70 years, you can apply for a larger loan. It will provide joint property ownership along with tax deduction benefits of up to 1.5 lakh rupees under the IT Act, section 80c.
Negotiate Hard
Even after shortlisting the best lender, keep pushing for the best deal you can get. Banks have the flexibility of offering better terms with regard to tenure, processing fees, balloon payments, payment modes, and so on, provided you have a good credit history and score, a good income, steady employment, flexible EMIs, lower interest rates, and so on. Always negotiate to get the best possible deal that you can get from the bank.
Pay Higher EMIs
Calculate your current and future expenditure, and also budget for emergencies, and compare this with your income and funds available. This will give you an idea of the maximum EMI you can pay. Choosing a high EMI and reduced tenure will help you lower your loan rate and interest burden, and pay off your loan quicker.
Partial Payments
Making part payments when you come into some extra funds will help you reduce your principal directly, which can have the consequence of reducing your EMIs and decreasing your overall interest amount. This will help you pay back the loan faster.
Refinance
If you happen to find a lender who is willing to offer better terms, transfer your loan to that lender, even if it has been just a few months since you availed the home loan. Refinancing or balance transfer is a method to reduce your EMIs, interest burden, or tenure.
Conclusion
The future opportunities for development in Thrissur are tremendous, making it a desirable location to invest in real estate. Varma Homes is one of the most reputed builders in Kerala who can connect you to the best lenders for availing of home loans. Banks are happier to lend when the builder is known to them and reputed for quality, integrity, and transparency. All Varma Homes projects adhere to all RERA and government regulations. Their premium 2 and 3 BHK apartments in the best localities of Thrissur are highly doubt after by home buyers.
FAQs
What are some effective ways to reduce your home loan interest rate in Thrissur?
To effectively reduce your home loan interest rate in Thrissur, you should start by doing thorough research. Compare different lenders based on interest rates, tenure, processing fees, and service quality. Reducing your loan-to-value (LTV) ratio by paying a higher down payment can also help. Additionally, having a co-borrower and negotiating hard for better terms can significantly lower your interest rate. Refinancing your loan with a lender offering better terms is another strategy to consider.
How does making partial payments on your home loan benefit you?
Making partial payments on your home loan can directly reduce your principal amount, which in turn lowers your EMI and overall interest burden. This approach helps you pay off the loan faster and saves money on interest over the loan term. It’s a smart strategy if you come into extra funds, like a bonus or inheritance, allowing you to reduce your debt more quickly and efficiently.
Why is it beneficial to have a co-borrower when applying for a home loan in Thrissur?
Having a co-borrower, such as a spouse, parent, or sibling, can be highly beneficial when applying for a home loan in Thrissur. It allows you to qualify for a larger loan amount due to the combined income, and it also offers tax benefits under Section 80C of the IT Act. Moreover, the shared responsibility can make it easier to manage the loan repayments, potentially qualifying you for better loan terms.
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