Understanding 7 Important Types of Home Loans in India
The biggest dream of every individual is to own a house, but the rise in the prices of real estate has made it difficult to transform the dream into a reality. There are various banks and Non-Banking Financial Companies (NBFCs), which provide home loans in India.
Seven important types of home loans in the country
Home loan finance meets different requirements of different individuals. Lenders are open to offering finance not only to purchase a house but for a number of purposes.
- Loan for the purchase of a home: This is a common type of housing loan in the country, where it is possible to buy a residential property on a loan. About 90% of the cost of the property is sanctioned as a loan by financial institutions.
- Loan for construction of a home: This housing loan is for the construction of a property on a piece of land. There are a large number of factors, which need to be considered, in order to arrive at the construction cost.
- Loan for land purchase: This form of home loan allows the purchase of land for the construction of the home. About 90% of the cost of land is offered as the loan amount. It has a long tenure and low home loan rate of interest.
- Loan for home expansion: The loan for home expansion allows the alteration of existing structure of the home.
- Loan for home improvement: There is a home loan for the renovation of the property. The loan for home improvement is ideal for repairs, renovation, painting, flooring, tiling, or electrical work inside the home. Not many are aware of the existence of this type of a loan.
- Home conversion loan: Individuals who already have a home loan but want to move into a new house can apply for home conversion loans. The current loan will be transferred to the new house and the purchase of the new house can be easily financed without having to pay the previous loan.
- NRI home loan: This home loan is specially designed for NRIs buying a property in India.
It is possible to avail of an easy home loan through NBFCs in the country. Home loan eligibility includes salaried or self-employed individuals with a good credit score and a business with a positive net worth or an experience of three years in employment. With low home loan interest rate, it is easier to purchase or construct a home without having to worry about the budget. The documents required for home loan include identity proof, address proof, income proof, business proof, and property proof. Making a home loan application is now easy. One can apply for a home loan online and enjoy a quick processing and approval.
NBFCs offer easy home loan at lowest interest rates as compared to banks and have a quick and hassle-free procedure of home loan finance.