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The Different Types of Home Loans Available in India _WC
The Different Types of Home Loans Available in India
An aspiring Home Loan borrower can choose from a variety of Home Loan types to cater to their exact home buying need. Here are the different types of housing loans available in India.
Home loans for purchasing an existing property:Home loans in their purest form are used to purchase a property, either a constructing one, a built one or a resale property. The lender remains the owner of the property until the borrower has cleared off all their dues. The borrower can only take back the ownership of the house after full loan repayment. If the borrower is unable to repay the loan amount fully, the lender retains ownership of the property indefinitely.
Home Renovation Loans:This loan type caters to home improvement projects or renovation expenses you incur.
Home Expansion Loans:Not to be confused with Home Renovation Loans, Home Expansion Loans are meant to fund the building cost of your home expansion.
Home Construction Loans:This loan funds the construction of a new house from scratch and not new constructions on an existing property. Some lenders allow the cost of the plot to be included in the loan amount, provided the plot has been purchased in under a year of seeking the loan.
Home Loan Balance Transfers:This loan facility allows you to transfer your ongoing Home Loan to a new lender to leverage better lending terms and make possible savings on your current EMI amount. It may come with an added benefit of a Top-up Loan, wherein the sanction amount has no end-use restrictions.
Joint Home Loan:A joint home loan is a housing loan taken by two or more people to divide the liability and contribute positively to the eligibility. There is always a cap to the maximum number of participants in a joint home loan. There is also a restriction on who all can enter into a joint loan together such as spouse, parents, siblings and/or children. This especially helps if the co-applicants have a good credit score.
Home Loans for NRIs:NRI Home Loan allows Non-Resident Indians to invest in properties in India using the facility of home loan while staying abroad. Many NRIs choose to invest in homes not by using their own money but by opting for home loans as this is more financially viable for them. They can pay EMIs and put their cash in hand to better use.
Home Loans for Women:In India, women can apply for home loans and enjoy more benefits and privileges than men. Some benefits may include lowered interest rates, simpler eligibility criteria, longer repayment tenors, lower stamp duty, and greater tax deduction claims. They can also use government schemes such as PMAY for an interest subsidy.
Home Conversion Loan:It is when you switch your existing home loan to another type of loan that the same lender is offering. For example, your loan is currently linked to a benchmark that is not the repo rate or vice versa, you will be probably paying a higher interest rate than the other type of home loan. In such cases, you could opt for a Home Conversion Loan.
Borrowers are advised to diligently research what market lenders are prepared to offer and how to meet their eligibility criteria to benefit from their Home Loan terms.
Note: The information provided on this page is generic and Bajaj Housing Finance may or may not offer all Home Loan types mentioned.
*Terms and conditions apply.
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