It is a dream of every working-class member of the Indian society to purchase a home. For this very purpose, he or she saves money in the form of fixed deposits, funds, etc. throughout their lifetime. However, in recent years, the costs of properties and plots have surged greatly; thus, a lot of people find it difficult to fulfil their dreams of purchasing a house of their own.
In here, financial institutions play a huge role by offering home loans in India at attractive interest rates. Further, the new-age banks and NBFCs (non-banking financial companies) even provide an additional discount of 0.05% on the interest rates for women borrowers and co-applicants. Thus, today in this article, we will be sharing a few tips that will greatly assist you in reducing your home loan interest rate:
- Look out for good deals: The new-age financial institutions have now started offering home loans online. Thus, you get the option to compare and look out for the loan products from the comfort of your home or office. The reason being, the interest rates charged by the new-age financial institutions vary from one lender to another; thus, comparing amongst them will help you choose the one that suits your needs the best. You can easily choose to compare amongst loan products on the aggregator’s websites.
- Loan tenure: The banks and NBFCs (non-banking financial companies) offer you flexible repayment options in the form of EMIs (equated monthly installments). This not only helps you to repay your current debts but also plan out for the future ones. Further, your EMIs are calculated on the basis of the principal amount, home loan interest rate, and repayment tenure. However, if you opt for a longer repayment tenure, then you would have to repay higher interest rates; thus, if you want to reduce your rates of interest- then choosing a shorter tenure would be a wiser option!
- Improve your credit history: The new-age financial institutions offering home loans in India scrutinize your credit score and history. The reason being, your credit history gives them an insight into your financial management skills and helps them you gauge your repayment capability. Therefore, ensure that you work and improve your credit score before applying for a housing loan; as this will greatly help you to negotiate and reduce your interest rates. The best way to improve your credit score and history is to repay all your previous and current debt on time.
- Transfer of balance: In the recent years, the banks and NBFCs (non-banking financial institutions) have taken a number of steps to help the borrowers, and the option of a balance transfer is one of them. Transfer of balance, as the name suggests, means that you will be transferring your outstanding loan account from one lender to another. This feature allows you to renegotiate on the rate of interest with the new lender- to obtain a lower home loan interest rate.
Hope this article will help you to obtain a lower interest rate home loan.
Good luck and all the best!