Your dream home is a worthwhile yet challenging goal. This most rewarding goal has quite a few hurdles, home loans for one. Explore this article to discover common housing loan challenges in your journey. Then you can get better equipped to deal with them.
Rejection:
Several first-time borrowers do not understand the process of home loan eligibility. Housing finance is not as simple as visiting online eligibility and EMI calculators. It is a right process. But you need a strong financial knowledge base to understand complex housing finance eligibility criteria. That’s why; most uninformed borrowers face a rejection. So, to overcome this challenge, you have to understand the most important rule of housing finance in India.
“Preparation is the key.” So, start home loan process right when you decide to buy a home. You can use the funds for down payment and repayment of current liabilities. This is your pathway to better home loan with lower interest rates.
Confusion:
A clear start of housing loan research is more questions than answers. Most borrowers are flooded with questions. Which is the best home loan rate for me? How do I select a repayment option? Will I be able to afford the suggested house loan EMI? What are all these fees all about? What will happen if I miss an EMI? This is a great start. The toughest question is – is this the best house loan for me? This unending dilemma can cause a lot of sleepless nights. So, unless you are an expert on the topic, take an advice of a professional. Several personal finance experts and housing finance consultants can help you. You can make much smarter choices by taking advantage of their knowledge base.
Down payment:
Housing finance companies expect you to contribute 15% to 20% of the cost of the property. So, you need to gather enough funds. At a same time, you will need funds for other expenses for example; processing fees, debt settlements, credit reports, and professional consultations. So, cash flow management is a big hurdle in such scenarios. However, valuation of a property is significantly lower the current market price. So, you will need to pay it through down payment. In such cases, here you have two options. You can add a co-applicant. Additionally, you can use few of your investments for down payments. Otherwise, you need to reconsider your choice of property. Select another affordable property for yourself.
So, any borrower has a tough road and few problematic decisions ahead. But, your dream home is worth the effort. So, make smart choices and enter your dream home confidently.
