New prospective home and property buyers would heave a great sign of relief to know that buying homes now does not necessarily mean breaking the bank and eking out all of your savings. Whether it is a home to live in, or a property you hope to invest in, the costs of owning a space can be truly intimidating and cause some serious financial damages if careful steps are not taken.
While builders and real estate agents make it their mission in life to tempt you with the best in housing and amenities, all of these come at a price not for the faint hearted.
Now, purchasing a house does not have to be something you can only dream of in the silence and safety of your mind; mostly thanks to the more easily accessible and available credit from home loans.
The steps towards taking out a loan might seem complicated, and could even cause some people to back out completely from the whole process. It requires carefully planned and precise moves to ensure a well-executed and hitch free process.
Here are 7 things to consider before taking a home loan;
Loan Options
The internet makes everything easier, and now it is even easier to do extensive research on some estate loans and find the ones that best suit your needs. Crucial in your research should be these factors; down payment, EMIs, and repayment tenure. These days, bridge loan lenders have become very popular.
Eligibility
You must first analyse your financial status, including your monthly earnings and average spending, and also put into considerations some of the future expenditures you might be making. You must be certain how much EMI you must pay each month is affordable to you, and is convenient enough to be adjusted.
Type of Home Loan
There are two major types of loans, and the type of home loan you choose will greatly affect your entire experience. The two types of loans are; fixed and variable. Fixed loans basically hold a clause where no changes will be made on the rate of interest irrespective of market changes, while variable loans change following changes in the market.
Fees and Charges
A loan package may seem attractive on the front, but without proper examination, you might find yourself caught in tricky fees and charges attached to the loan. Make sure to inquire on the various fees applicable to the loan you are considering.
Loan Tenure
A longer tenure will result in you paying a higher interest in all the accumulated time. Decide on the loan tenure and consider all options before making a final decision.
Additional Charges
Check for all of the other charges – processing, service or administrative- which the lenders offer. Discuss all these with your lender before finalising any loan application, and find out how often the charges have to be paid.
Cross all ‘T’s
Before putting your signature down, make sure to read carefully through the content of the document. No matter how boring and tedious it could be, doing so is very important. Make sure that all terms and conditions stated in the document are what you have actually agreed to, and make sure all charges are applicable to your loan package before signing the dotted line.