Housing loans have dropped
to attractively low rates recently, making home-buying more affordable in
India. The interest rate levied on the principal amount largely determines the
cost of borrowing. However, there are additional charges too, which contribute
to the total cost, including processing fees. This article elaborates on the
home loan process, along with its associated fees and charges.
Understanding processing fees
Processing fees are
one-time, non-refundable charges imposed by lenders to cover credit appraisal
costs. The amount depends on the type of loan, profile and income of the
applicant and it is charged irrespective of a loan application’s approval or
rejection. As these are not deducted from the loan amount, you need to pay the
processing fee separately. Lenders may impose from 0 to nominal fees as
processing charges as per their discretion. For instance, reputed HFCs levy up
to 6% of the loan amount as these fees. Generally, lenders impose this charge
at the time of document collection for initiating their home loan process.
Besides processing fees,
here are some other homes loan fees and charges you may need to pay:
●
Foreclosure
charges – Most lenders impose
these charges when a borrower forecloses or pays off the full outstanding loan
amount in a single instalment before the tenor ends.
●
Part-prepayment
charges – Most lenders charge these fees when borrowers pay off a
significant portion of their loan before the tenor ends.
●
Penalty fees –
These are imposed if a borrower defaults in paying EMIs.
●
Bounce rates – Insufficient funds often lead to EMI cheque bounces, which is when these
bounce rates are levied.
●
Secure fees – It is charged
to offer and maintain online services and payment facilities.
Note that borrowers may
also need to pay GST as applicable.
Learn the home loan application process
Once you have checked all
the home loan rates associated, you can proceed to apply.
Step 1: Visit the official website of your chosen lending
institution.
Step 2: Find the online application form and fill it up accurately
with details of employment, financial, personal and property information.
Step 3: Make the secure fee payment online.
Step 4: Next, scan all the documents necessary to process a home loan
and upload to complete your application process.
Alternatively, existing
clients can look for pre-approved offers that simplify the process of availing
loans and save more time. You can avail of such schemes on a range of financial
products like home loans, loans against property and more. To check your
pre-approved offer now, provide some essential information only.
Reputed HFCs in India
provide high-value credit to fulfil your property buying needs adequate, along
with attractive home loan offers. Eligible applicants can seek up to Rs.3.5
crore, enjoy interest subsidy under the PMAY scheme, online account management
facility, property dossier, etc.
Make precise assessments using online tools
Up to 75% - 80% of a
property’s value available as loans certainly takes you closer to your home
buying dream. However, credit is best utilised when planned ahead in time. So,
opt for an online EMI calculator to know the total payable interest. It is a
user-friendly online tool that takes loan amount, tenor and rate of interest to
calculate EMIs per month and total payment comprising both principal and
interest components.
Another crucial tool is a home loan eligibility
calculator which shows you the credit amount you can borrow instantly.
These save the overall cost of borrowing and helps in evaluation with instant
calculations.
Checking the entire home loan process along with other associated fees involved, always keeps you on the profitable side and saves from surprising charges, if any. Approach a leading housing finance company to enjoy the best deals at attractive interest rates.
Resources:
https://www.financialexpress.com/money/what-are-the-costs-involved-in-taking-a-home-loan/1494400/
https://www.bajajfinserv.in/home-loan-processing-fee-and-charges
