7 Best Options to Repay Your Housing Loan With Ease

Posted by Aditi Ahuja on June 25th, 2018

Buying or constructing a new home demands considerable amounts of funds and needless to say, a home loan emerges to be the most credible solution under such circumstances. Do you know how banks calculate interest on home loans? Are you aware of the multiple types of repayment methods that will suit your need? Do you know if they comply with the RBI guidelines for Home Loan? Availing a home loan should be a well thought out process.

You have to consider Loan interest rates in India, the time to process the amount and other key factors. Another important issue you should look out for is the type of home loan that you are opting for.

Today, there are different types of home loans that are available in the market. They offer unique benefits and diverse repayment options. Let’s take a look at the seven most popular housing loans in India.

1. Loans with Delayed EMI Initiation –

NBFCs and banks give options to their borrowers where the payment of EMI starts at a much later date. This facility allows a borrower a flexible period to organise his / her financial responsibilities.

Home Loan offers customers a unique opportunity to take an EMI holiday for three months; this makes them unique in the market along with their top-up loan offerings and quick processing time. They also bring you pre-approved offers for home loans and other financial services so that you can save time and get instant financing.

2. Long-term Home Loans –

Multiple organisations offer long-term home loans that allow borrowers to increase their eligibility by up to 20%. Long-term loans also provide an option to extend the tenor period up to one’s retirement ag. These types of loans are popular for young professionals and salaried office workers.

3. Home Loans with Some EMIs Waived Off –

Multiple companies offer home loans where they waive off some instalments if you pay due amounts regularly. These types of housing loan are getting increasingly popular among people looking to buy a new property.

4. Home Loans with Increasing EMIs –

If you are thinking about how to repay home loan in the quickest period, this type of loan will be the perfect option for you. The EMI starts low in the initial years and increases over time. It assumes an estimated income growth and keeps increasing accordingly.

You can avail a much higher amount in this scheme; also, increasing EMIs reduces the tenure significantly.

5. Home Loans with Decreasing EMIs –

Working in just the opposite manner of the previously mentioned type, these schemes lead to a gradual decrease of EMIs over the progressive repayment period.

Before availing this type of loan, please remember to check the amounts due using a repayment of housing loan calculator. EMI amounts are higher during the initial years; you must also have a prepayment plan ready to clear the loan early.

6. Loan Against a Savings Account –

Multiple financial organisations allow you to link your bank account with the home loan account. It allows the current account’s surplus funds to be used while aiding your bank account to function normally. In this type of loan, the interest rate is calculated by deducting the account balance from the outstanding loan balance.

7. Housing Loan for Under Construction Property –

You will be liable to pay only the interest of a loan amount if you purchase an under construction property.  The amount you pay will depend on interest, and then the principal repayment will be calculated from the balance. In this scenario, you will not get any tax benefits on principal you pay during the property’s construction.

It is important to look for the perfect repayment method for your Housing Loan. A specific financial situation might require a different approach; if you need help, don’t be shy to seek help from a legal advisor or an industry expert. Also, make sure you have a plan to repay the outstanding amount as soon as possible.