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A Simple Home Loan for a Secure Future

Home finance in India has become one of the most frequent and sought after loans. Be it a self-employed or a salaried individual, home finance today has become a sort of necessity. One might not take a personal or a vehicle loan, but he will go for a home loan. Such has been its importance that you will find several companies, nationalised and private, venturing into home loans. This is also due to the reason that even the government is focusing more on affordable housing as a category and hence pushing the need of owning a home among people.

In our country, the need for having a house has seen rapid growth over the past few years. Two major reasons for this are:

  • Urban cities have seen a tremendous rise in the population because of the exposure that they give to an individual.
  • There has been a gradual increase in the infrastructure development of tier 2 and tier 3 cities.

Growth in infrastructure has further resulted in:

  • People getting options to look forward to having their own home.
  • Increase in the number of finance companies from the Nationalised and Private sectors. Banks & Non-Banking Financial Companies (NBFC’s) have mushroomed across the length and breadth of the country. 

The rise in the middle class has given a lot of push to the basic infrastructure development of the country, and by this, we mean to say the rise in the number of housing projects which have come up. To attract prospective buyers to invest ina housing loan and NBFC’s, the rate of interest which used to be painstakingly high before has come down drastically and for good. Most of the housing finance companies offer a very attractive rate of interest to prospective customers. This is obviously due to the stiff competition which is prevalent among them and since the buyer now has plenty of options to choose from the lookout for the best rate of interest from the lot.

Home loan can be further categorised into:

  • Housing loan for a new house or a resale: In this scenario, you avail a loan for a house which is either under construction or is available as a resale property.
  • Construction loan: This is a category where you take funds from the financial institution to construct a house on the plot which you have or make amendments or renovate the existing property which you have.
  • Balance transfer: Under this scenario, you can transfer the home loan from an existing financial institution where you have a relationship to some other financial institution. Thisis done due to two factors:
  • Attractive Rate of Interest offered from the other financial institution.
  • The option of a top-up loan over the existing loan amount.
  • Non-Resident Indian (NRI) home loan: This is a home loan where even if a person is staying abroad, he or she can avail a home loan by the income documents that support the financial credibility. The NRI status will not affect your plans to buy a house in the country.

The expansion which the Housing Finance Industry has seen in India is second to none. The National Housing Board (NHB) which rolls out the guidelines for Banks and NBFC’s has simplified the home loanprocess further to ensure that every individual in the country has a home to stay in.

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