Arvind Hali, MD & CEO, ART Affordable Housing Finance
Home is one of the most important necessity of human after oxygen, food and water. Home is the place where one feel most safe, protected and relaxed. Owning a house is one of the aspiration every Indian holds in their heart. Having own house gives a feeling of financial stability, emotional and social security.
“Past decade has seen sky-rocketing of real estate prices in the big cities of India, the small cities have also seen significant upward movement in the housing segment leaving the home buyers reconsidering or postponing their home-buying decisions.” Arvind Hali, CEO and MD, ART Affordable Housing Finance said, “in these cases, home loan serves as the best option for those who aspire to have their own house. There are several types of home loans, which can be availed with housing finance companies and Banks. In last two years with the help of government initiatives many affordable housing finance companies have come up to cater to the need of rural and semi-urban India. Home loan not only helps in buying home with installments, it also serves as a major relief in personal income tax as per Income Tax act under section 24 and 80C.” There are different kinds of home loans based on different needs one can look at as following –
- Loan for Home Purchase:
This type of loan is probably the most common type of Home Loan option available amongst the lenders. Customers can avail this loan for buying any ready to move/ pre-constructed property.
- Home Construction Loans:
People who want to construct their home as per their preferences and specifications and who do not wish to buy a pre-constructed flat/bungalow, can opt for this loan. This type of loan is somewhat different from other home loans as a lending institution not necessarily be providing fund for purchase of land/plot for your home. That means land price is excluded in this loan. This is only applicable for land owners.
- Home Extension and Home Renovation Loans:
Living in a big and beautiful house is everyone’s dream. In many cases, due to circumstances, one may not be able to fulfill the wish of having desired designs and set-ups etc. during the time of purchase due to financial crunch or any other reasons. Later, one may consider taking loan for home renovation and extension with new and trendy interiors.
- Refinance :
Under certain situations one may have purchased a property with own savings but would want to recover the financial liquidity with him hence can opt for reimbursement of expenses already spent for buying, constructing or extending a home. Lending institutions generally have few clauses under this loan category like: putting a limit on time gap between and loan application.
- Top ups on home loans:
Under home loan top ups, a borrower can get a certain sum well beyond their home loan amount. A borrower can apply for a top-up loan from the same institution from which she has the current home loan. It can be utilized for any individual reason.
- Home Loan Balance Transfer:
Home loan balance transfer enables a customer to transfer home loan from one financial institution to another financial institution depending upon the schemes and rate of interest provided by another institution.
One may choose to transfer home loan to another lender for reasons like rate of Interest, any running scheme or may be for better quality.
Though there are ample options available for home buying, one must do proper due-diligence and checks before choosing the right loan category, tenure and lender. Home buying mostly once in a life-time investment one does, it should be with utmost prudence.