How to plan for your future home?

As the saying goes, “home is where the heart is”. While professionals progress in their career endeavours, often the focus on family needs take a step back. Often, with the routine of day to day fire fighting while meeting business requirements, planning for the long term becomes difficult. Many start planning for a car immediately after joining a good job, because it helps in facilitating the travel from home to work and vice versa. However planning for a residential investment takes time due to reasons like large value of the potential investment, availability of alternative (rental, old homes, etc.) and nature of job where one needs to be mobile globally. This video really captures it beautifully.

This is where planning for the long term is required for every professional who has started their career in any industry.  The process of buying a home is not very simple. The task itself to search for a suitable set of flats / houses can become a long and arduous task. Short listing the final one among the ones you like is even more difficult.

The first step is identifying how much one can really shell out for such an investment. One needs to remember that one should be able to pay at least 10% to 30% (ideally 10% over eligibility) of any property value directly, while the rest can be paid by loans. This percentage differs based on value of the property. How would you know, what is your true eligibility in terms of a bank loan? How much can you pay upfront? Find out here: www.trueworth.co.in. One also needs to consider the fees for legal processes (e.g. registration, lawyers, etc) which can reach 9% of the home value. Once this is decided by a rough number, say Rs 30-40 Lakhs, or Rs 40-50 Lakhs, or Rs 50 – 65 lakhs etc other factors start kicking in. Many factors can become critical while deciding which home to go for. Some of these factors are as follows:

  1. What is the locational advantage of the place where you would want the property to be located?
  2. How far is it from your potential workplaces?
  3. How far is it from markets, banks, hospitals and schools?
  4. What is the proximity to metro stations?
  5. What is the proximity to airports and railway stations?
  6. What is the brand name of the builder? Is the group building or marketing it a well known name within the industry?

However, even after selecting a home, the legal processes of nomination / nomination transfer, the buyer seller agreements, the registration presents another set of formalities. But before one delves deep into that, one needs to consider the options of financing the purchase. There are so many different options for financing. How does one select the financial institution and why is this step critical?

Home loan repayment becomes critical decision factor which is affected by the different customized options through which a borrower may be enabled to pay back the loan by paying same / different levels of EMI throughout a certain time period. Most people search for flexibility in loan repayments and alternatives like opportunities for prepaying, tax benefits, types of interest rates (floating vs fixed), balloon payments, step up/down repayments, etc. While there are different banks which provide home loans, it is always best to approach a professional group who are specifically focused on the domain of home loans.

Aditya Birla Finance Home Loans are one such specialized financial institution who have very customer friendly customizable solutions for your home loan requirements. They have different offerings like home loans, home extension loans, home improvement loans, plot and home construction loans and home construction loans. They offer benefits like attractive interest rates, loan tenure up to 20 years, quick & transparent processing, options to choose between simple EMIs or structured repayments, zero pre-payment charges for floating rate home loans given to individuals, attractive balance transfer options and last but not the least door step services for busy professionals.  #TheHomeLoanIDeserve

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Author: Kar

Dr. Kar works in the interface of digital transformation and data science. Professionally a professor in one of the top B-Schools of Asia and an alumni of XLRI, he has extensive experience in teaching, training, consultancy and research in reputed institutes. He is a regular contributor of Business Fundas and a frequent author in research platforms. He is widely cited as a researcher. Note: The articles authored in this blog are his personal views and does not reflect that of his affiliations.