Home loans in India are available at the discretion of the lending institutions. However, most of the time, if you comply with the eligibility criteria of getting a home loan, you get to select the best offers available from a number of lenders in the market.
Choosing the right lender to get a home loan from can be quite a difficult decision to make. Even with a large number of financial institutions prepared to accept your loan application, it does not guarantee that you are getting the best possible offer.
Also, when you avail home loans in India, your obligations will last for more than 15-20 years. That is why choosing the best lender takes precedence over all other factors while applying for a home loan.
What Is the Most Important Factor When It Comes to Choosing a Home Loan?
Home loans in India are set apart from other loans because of two primary factors. They are:
- High-value loan sanctioned against a mortgaged property.
- Long repayment tenors.
For the reasons above, the home loan interest becomes a crucial factor to consider while availing the advances. Before choosing a lender, you should check the interest rate offered by different financial institutions and opt for an affordable one.
Things to Look for While Choosing the Perfect Lender
There is a list of things you should refer to while choosing the perfect mortgage lender to avail a home loan in India. For instance-
- Go for Institutions Offering EMIs You Can Afford:
The interest rate offered by an institution is instrumental in determining the EMI amount. So before choosing a lender, calculate the EMI you need to pay each month with the interest rates they are offering. Use Online EMI Calculator to know your EMIs beforehand and apply for an amount which computes affordable installments as per your repayment capacity.
- Do Not Always Settle for the “Lowest Rate Deal”
However, selecting the best lender should not be confined to settling for the one who offers the lowest home loan interest rate. Just because the financial institution offers the best lending rates does not mean that they will offer superior services as well. Moreover, often lenders offering very low-interest rates impose higher rates of associated charges like processing fees, pre-payment charges, etc.
Also, check if the institution is providing online home loan application facilities as well before applying.
- Check the Lender’s Reputation
Research is key when it comes to choosing the right lender. You need to conduct a proper background check on the lender beforehand. Go for the institution that has the best reputation in the market. Also, gathering as much information as possible about the lender before you avail the loan is better in the long run.
- Compare Between Various Institutions
Even though researching and comparing between various institutions can be tiring, it is essential if you want to avail the best home loan offers. Also comparing between different lenders and their services enable you to choose the company that caters to your specific needs.
- Seek out the Best Offers
There are financial institutions that offer added benefits to their financial products.
- Have Clear Goals About What You Want
To choose the best lender, it is crucial to have a clear idea about what you want. Make a comprehensive study about factors like the type of interest rate (floating or fixed), repayment tenors (short or long), etc. before applying. If you have a clear idea about these factors, choosing a lender and repaying the loan becomes much easier.
Availing a home loan and consequently paying it back is quite a long drawn process. Also, defaulting on repayments may lead to losing the asset you have mortgaged. So, before settling for a lender, make sure that you conduct thorough research and compare among many to avail a loan with the most beneficial terms.