How To Compare Banks/NBFCs While Taking A Home Loan
Innumerable financial institutions are offering home loans today. Frankly speaking, it can be quite overwhelming for a person to understand which lender to go for. Add the pressure of choosing the right property and going through the purchase formalities to this – we can understand how stressful it can be.
So, here are a few points which you should consider while comparing different banks/NBFCs home loan offerings.
1. Interest rate: A quick comparison of interest rates is essential to understand who is giving the best one. Also, conduct a quick study of the historic rates to compare the movement in floating rates of different lenders.
2. Loan tenure: Are they allowing you to take the loan for a long tenure? What is the maximum age for getting a home loan?
3. Processing fee: This directly impacts your principal amount, hence, very important.
4. Prepayment or foreclosure charges: Do they have any?
5. Hidden costs: Are there any hidden costs?
6. Eligibility: What is the eligibility criteria of the lender? Check this thoroughly before applying for a loan to avoid rejection.
7. Customer service: A home loan is a long-term relationship with a lender. Therefore, you need a financial institution you can depend on. Does it have a loan servicing department? Are customer executives friendly? Are they responsive? Delve beyond the loan executive who comes to you when you are taking the loan.
8. Special offers, if any: Do any of the lenders offer any special scheme such as the Pradhan Mantri Awas Yojana.
We recommend you to make a checklist and spend some time understanding different banks’ offerings. This will help you make an informed decision.
So, now that you know all the nitty-gritty of home loans, it will definitely make you street smart while you are buying your home by taking a home loan. It is always better to know things before you jump in. Hope you have enjoyed the learning journey of the module. There are many such interesting modules we have curated for you in our ELM School. Do read them as well.