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If you are reading this article, then you most probably want to know whether you can transfer your personal loan to someone else. The bad news is it is not easy to find the answer since it is highly unlikely that a personal loan transfer can happen.&nbsp;
Here&rsquo;s why it is so difficult.&nbsp;
A <a href="https://www.mymoneykarma.com/personal-loan.html" target="_blank">personal loan</a> given to you by a lender is dependent on your individual eligibility criteria, which the next person may not fulfil. Thus, from the lender&rsquo;s perspective, it is unfair and thus not possible. For instance, the loan was given to you because you can repay on time. The person you want to transfer this loan to may not have the repayment capacity. And that makes it so risky for a lender or bank. Similarly, the interest rate and amount given to you may not be suitable to the other person.
If such a loan is transferred to a new person, the loan terms and conditions shall need to be changed to suit the new person&rsquo;s needs and eligibility. Thus, personal loan transfers are not generally allowed.&nbsp;
That being said, there are two types of personal loans that can be transferred.
These are:
<ol class="homeloan_Faqs_ul_1">
<li>
<a href="https://www.mymoneykarma.com/loans/transfer-car-loan-to-other-person.html" target="_blank">Car loans</a>
</li>
<li>
Mortgages
</li>
</ol>
<h3 class="credit_i_h3">Why transfer a mortgage?</h3>
There can be many reasons for why you wish to transfer your mortgage to someone else. Perhaps you wish to sell your home or the party with whom you have a joint mortgage wishes to remove their share. Whatever your reason can be, here are 3 ways of transferring your mortgage.
<img class="img-responsive credit_i_img" style="height: 640px; width: 683px;" src="https://mmk-s3-cms.s3.us-west-2.amazonaws.com/1616130335998.jpeg" alt="Transfer is made possible by the bank only if they find the new borrower eligible and capable of repayment as well." />
<ol class="homeloan_Faqs_ul_1">
<li>
When you are selling your property: In case you are really selling off your home and have not yet paid the mortgage, you can then transfer your mortgage to another person. Yes, that&rsquo;s totally possible! Such a person can do two things: take your mortgage with your lender, or take a loan from a new lender to pay off your lender. In both ways, you shall be paid back with the money you have given for mortgage repayment.&nbsp;
</li>
<li>
When you want to sell off your share of a joint mortgage: This can be a bit difficult for anyone. When you transfer your mortgage from a <a href="https://www.mymoneykarma.com/buying-a-home/joint-home-loan.html" target="_blank">joint mortgage</a> to a sole ownership or sole mortgage, it is called Transfer of Equity in legal terms. The only way it is possible is if the bank believes the other person can repay on time. The new borrower can take the aid of a mortgage broker to lengthen his/her repayment period, or alternatively, find a new lender.
</li>
<li>
When you want to erase your name from a joint mortgage: This is possible as well with a transfer of equity. In case the co-mortgage holder has no intention to buy your share of mortgage, you have other options. You can rent out your property or sell your property&rsquo;s share to a new buyer.&nbsp;
</li>
</ol>
<h3 class="credit_i_h3">Here&rsquo;s how you can transfer your mortgage</h3>
Considering that you are the property&rsquo;s owner:
<ol class="homeloan_Faqs_ul_1">
<li>
The buyer will be requesting you to provide the letter showing your loan is being foreclosed in lieu of selling of the concerned property.
</li>
<li>
The buyer needs to fill up the home loan application form and give the processing fees
</li>
<li>
One needs to get a NOC or No Objection Certificate from the developer
</li>
<li>
The buyer now needs to provide all the required KYC documents as well the required income proof documents.
</li>
<li>
An evaluation team shall be sent by the lender to evaluate the concerned property to decide its value.
</li>
<li>
The buyer shall be disbursed the sales consideration as the amount of loan. You as the seller shall get a cheque from your lender.&nbsp;
</li>
<li>
Finally, you&rsquo;ll transfer photocopies of all property-related documents to the buyer. The original ones shall be sent to the lender.
</li>
</ol>
&nbsp;

Can a mortgage be transferred from one person to another? If so, what is the procedure involved in making it possible? mymoneykarma offers a step-by-step guide for mortgage transfer.

How to Transfer a Mortgage Loan to Another Person

Your home is not just the building or the physical property itself. Your home is made up of your family, your feelings, aspirations, dreams and hopes. Yes, that is what makes a home, not just bricks, cement, etc.

Now imagine losing your home all of a sudden. That’d spell huge emotional and financial setbacks surely. After all, most of us don’t sit on enormous piles of money to buy new homes just like that. Buying a home is one of the most important decisions and times of one’s life. That’s why losing it for any reason hurts so much.

However, there is one thing you can do to ensure that a setback like this won’t destroy your finances, and that you can still get a home easily. For this, you need to insure your property. This is just like insuring your car. If your car gets damaged, you can get your insurance money to get another car or to repair the one you got. Insuring your home is just like that. For instance, if your home gets damaged or destroyed completely, you can get it repaired or can buy a new one from your insurance money.

Here are 5 reasons to go for a home insurance:

<h3 class="credit_i_h3">Natural disasters</h3>

Let’s face it. The real estate boom is all fantastic, but it also means many properties are not being built according to plan, or properly. Earthquakes are the cause of the total destruction to homes more than anything. If you have your property insured though, you won’t have to worry about much except to get out of harm’s way. As you can see, it gives you a great peace of mind. Properties can also fall prey to cyclones, tsunamis, tornados, hurricanes, and fire. However, remember that floods are not covered by this insurance type, and you need to take separate insurance for earthquakes.

<img alt="Your Home Insurance provider is liable to reimburse you for all damages &amp; stolen items resulting from a robbery." src="https://mmk-s3-cms.s3.amazonaws.com/1616130244380.jpeg" style="height:640px; width:960px" class="img-responsive credit_i_img">

<h3 class="credit_i_h3">Protect your property from theft and robbery</h3>

You may think that since you live in metro cities, your home will never be robbed, or that there shall never be theft. But if you have been seeing the news, these cases are on the rise. If you have home insurance, the insurance company shall reimburse you for all damages and stolen items. To make sure the reimbursement process goes smoothly, you need to keep a list of all costly items you keep at home. Thus, if anything is stolen, companies can’t deny you the money.&nbsp;

<h3 class="credit_i_h3">Paying medical bills</h3>

You can be held responsible if anyone has an accident within your property. To make sure you won’t face difficulties, you need home insurance as it protects you from these instances. For anyone injured within your property, the insurance shall give the person’s medical bills.&nbsp;

<h3 class="credit_i_h3">You get peace of mind</h3>

When you have home insurance, you don’t have to worry about anything untoward happening to your home or property. If anything happens, the insurance company shall take care of it.

<h3 class="credit_i_h3">Mortgage lenders shall be satisfied</h3>

Some lenders and banks need you to have your home insured since it protects their investments against various risks. Thus, depending on the mortgage amount, you need to pay an amount for your home coverage insurance.

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Home insurance is often mandated by many home loan providers. But is it really necessary? We cover the benefits of home insurance and why you should go for it.

Is Home Insurance Mandatory For Home Loans? | mymoneykarma

If last year has taught us anything, it is that problems and uncertainties can come at any time. They won’t even warn you, and place you in a whole lot of financial hardships. Such times when the need of the hour is for urgent funds, you need a well-informed approach and a sound decision making process.

There are so many ways you can take a loan, but some of the ways are better than others. For instance, out of the many things that can be put as collateral for loans, your house is one of the most valuable assets.

<img src="https://lh6.googleusercontent.com/gHfkEg2AXERNN7-aqow3wT9km-FDPpQ5vV0KY0DCFKhZnZ3NKRnukjznMt0GsKSVmlafgn9FJrWqB39lPWkRcEGM0GBH8_Vm22egv-uC2u6EYJKn2m3vrfZ56ddLgg" style="height:416px; width:624px" class="img-responsive credit_i_img">

There are two types of loans which are offered by banks against mortgage of a residential property. These are Mortgage loans and home equity loans. Below given is a comparison of the two.

<table class="table table-bordered credit_i_table">
	<tbody>
		<tr>
			<td>
			Category
			</td>
			<td>
			Mortgage Loan
			</td>
			<td>
			Home Equity Loan
			</td>
		</tr>
		<tr>
			<td>
			Definition
			</td>
			<td>
			A mortgage loan is a type of secured loan offered by banks and Housing Finance Companies (HFCs) against a commercial or residential property owned by the borrower.
			</td>
			<td>
			A home equity loan, also known as a second mortgage loan, allows homeowners to borrow against the equity in their property. This loan is typically offered on a fully constructed property with clear title.
			</td>
		</tr>
		<tr>
			<td>
			How is Loan Amount decided?
			</td>
			<td>
			The loan amount depends on the current market value of the property.
			</td>
			<td>
			The loan amount is based on the difference between the current market value of the property, and the owner’s mortgage balance due.
			</td>
		</tr>
		<tr>
			<td>
			Loan Amount
			</td>
			<td>
			Up to Rs.10 crore 
			or 
			Up to 80% of the property value
			</td>
			<td>
			Up to 60% of the Net value 
			&nbsp;
			</td>
		</tr>
		<tr>
			<td>
			Loan Tenure
			</td>
			<td>
			Up to 15 years
			</td>
			<td>
			Up to 15 years
			</td>
		</tr>
		<tr>
			<td>
			Rate of Interest
			</td>
			<td>
			Lower than a home equity loan
			</td>
			<td>
			Lower than a personal loan
			</td>
		</tr>
		<tr>
			<td>
			Type of Interest
			</td>
			<td>
			Floating (in most cases)
			</td>
			<td>
			Fixed (in most cases)
			</td>
		</tr>
		<tr>
			<td>
			Processing Time
			</td>
			<td>
			Up to 10 days (subject to documentation clearance and other verification)
			</td>
			<td>
			2 to 4 weeks (subject to documentation clearance and other verification)
			</td>
		</tr>
		<tr>
			<td>
			Prepayment Charges
			</td>
			<td>
			No prepayment charges for floating rates
			</td>
			<td>
			Varies from one lender to another
			</td>
		</tr>
		<tr>
			<td>
			Features &amp; Benefits
			</td>
			<td>
			 
			●&nbsp;Lower interest rate 
			●&nbsp;Attractive tax benefits 
			●&nbsp;Available to both salaried and self-employed individuals 
			●&nbsp;High loan amount availability 
			●&nbsp;Can &nbsp;be availed against a residential/commercial property or a plot/land owned by the borrower 
			●&nbsp;Faster loan processing and Speedy approval 
			●&nbsp;Freedom to use the loan amount for any purpose
			</td>
			<td>
			●&nbsp;Available to individuals with low credit score 
			●&nbsp;Freedom to use the loan amount for any purpose 
			●&nbsp;Higher loan amount on offer than a personal loan 
			●&nbsp;Flexible repayment tenure 
			●&nbsp;Affordable rate of interest 
			●&nbsp;Can be availed against a residential or non-residential property
			</td>
		</tr>
		<tr>
			<td>
			Loan Types offered
			</td>
			<td>
			●&nbsp;Top-up loan:&nbsp;allows the existing borrower to avail extra funds after a certain time period of successful repayment 
			●&nbsp;Overdraft facility:&nbsp;allows the borrower to deposit surplus money in the account for as short as a few days and enjoy reduced interest liability 
			●&nbsp;Regular mortgage loan (Term loan):&nbsp;allows the borrower to avail a large amount at a floating interest rate 
			 
			&nbsp;
			</td>
			<td>
			●&nbsp;Home equity line of Credit:&nbsp;allows the borrower to withdraw funds as per his/her convenience, through the issued cheque book or credit card 
			 
			●&nbsp;&nbsp;Fixed-rate loan:&nbsp;allows the borrower to avail a higher loan amount at an agreed rate of interest and repay it over a predefined tenure 
			&nbsp;
			</td>
		</tr>
	</tbody>
</table>

As you can see, both lines of credit can give you considerable loan money, even at lower interest rates and short periods of time. Note however that the loan amount depends on the property’s current market value. It can be less than what is offered in a home equity loan since in this case a new property has more value.

&nbsp;

The differences between many mortgage and secured loan products can be quite confusing. Here, mymoneykarma lays out the difference between a second mortgage and home equity line of credit.

Difference Between Second Mortgage And Home Equity Loan

Most of us buy just one home or residential property in our lifetime, and even that with a loan. Buying a residential property for yourself, or in other words buying a home, is a one-in-lifetime investment. It is quite natural that we would look for a dream home, or in other words the perfect home for ourselves and our loved ones. The size of the property, the quality and location of it depends on how much money you have, or how much you can afford. Your affordability depends on your income, which in turn depends on a host of factors like age, income level, amongst others. It also depends on your current loans and on your ability to repay.&nbsp;

To stop people from taking undue risks, lenders have norms in place which stop you from your EMIs to be more than a certain part of your take-home income. For instance, if your take-home pay is Rs. 40000, your total EMIs over all your loans can’t be more than Rs. 20000-25000. If that is what you are already paying, and on top of that you want a new loan, you are likely to get declined.

<h3 class="credit_i_h3">How to make your chances of getting a home loan better?</h3>

The best way is to add co-applicants to the loan application. When you can co-applicants, the lender is more likely to approve because it gives them more security. This is because in case you as the primary applicant is not able to repay, the co-applicant can and will have to repay the loan. Thus even for the applicants’ point of view, the risk is divided.&nbsp;

<h3 class="credit_i_h3">Who can be a co-applicant?</h3>

Ideally, co-applicants are family members. As for eligibility, they can be salaried, self-employed and even NRIs.

<h3 class="credit_i_h3">Benefits of taking a joint home loan</h3>

There are two main benefits of taking a joint home loan.

<ol class="homeloan_Faqs_ul_1">
	<li>
	Higher loan eligibility: Alone, as the only single applicant, you may find it hard to get the loan. But together with a co-applicant, your loan application is stronger. Thus, you have more eligibility. With a co-applicant, you can ask for longer or shorter loan repayment terms, lower interest rates, more loan amount, and even custom loans. 
	<img src="https://lh3.googleusercontent.com/9o1cGmY7eDMrM5S9jeyFbQJIUNA41lqmjUamXs5vwUlRQqEOQlxpo9V324zf6x7Ainm7iOQ4SgZsxUiCJf4HZwwdO9Vpq7Ig5rmhoZ_FsDzMP2dLhBStDWPAnBTlMw" style="height:416px; width:624px" class="img-responsive credit_i_img">
	</li>
	<li>
	More tax benefits: When you jointly apply for a home loan, you get more tax deductions separately. However, you both need to be co-owners of the concerned property in this case, and you both need to be contributing towards repaying the loan. The Principal repayment is eligible for deduction under Income Tax Act’s Section 80C till a maximum of Rs. 2 lakhs. Interest payments can have tax deductions till Rs. 2 lakhs under Section 24. When the property is let out, the interest in its entirety is eligible for tax deduction. The actual tax benefits you as a co-applicant depends on your repayment contribution.&nbsp;&nbsp;
	</li>
	<li>
	Special interest rates for women co-applicants: As an additional benefit, women co-applicants can enjoy lower interest rates.&nbsp;
	</li>
</ol>

Is it better to get a home loan as a lone applicants, or with a joint application? mymoneykarma elaborates the many benefits of a joint home loan application.

Joint Home Loan | What Are the Benefits of Taking a Joint Home Loan?

Buying a home is a huge step when it comes to building assets. But sometimes it becomes quite a task to understand what measures should be taken before jumping to a decision.
Are you still trying to figure out why your home loan got rejected? Confused between government banks and private banks- which is the best bank for a home loan? Where will you find the lowest interest rate on home loans? What are the eligibility criteria to apply for a home loan? Hold on, we are not reading your mind. These are the most frequently asked questions when a person considers buying a home.
If you are buying a home for the first time or maybe just confused about the process, you have landed in the right place. Our group of experts will help you clear out all your questions regarding the purchase of your biggest asset. With almost a decade of experience, mymoneykarma takes pride in helping people understand their housing options better and make a calculated investment when it comes to buying a property.
Read our articles, weigh your options and make your dream home hit reality with just a tiny bit of help from us!

Master the complex tasks, calculations, strategies and habits that go into financing your dream home and making your house the star of your personal finance asset portfolio

Your comprehensive guide to home-ownership and personal finance

Are you planning to buy <a href="https://www.mymoneykarma.com/buying-a-home/index.html/tips-for-first-time-home-buyers.html" target="_blank">your first home</a>? Then you are well aware of the humongous challenge ahead of you - Down payment for your <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">home loan</a>.

The challenge? To save every extra penny to stack up that down payment for your new home. High-five if you think saving money is difficult. I had to toil hard to save for my first home.

When it comes to buying a house, the brainstorming session to figure out creative ways to pinch pennies is painstaking. So, if you're a prospective homebuyer trying to save money, I feel your pain. That's why I am here with my 19 tried-and-true tips to get your dream home sooner than expected.

So, let's begin.

<ul class="banklogin_ul">
	<li>
	Create A Household Budget - &nbsp;A household budget will help you determine how much you can expect to <a href="https://www.mymoneykarma.com/buying-a-home/index.html/index.html/track-monthly-expenses.html" target="_blank">save every month</a>. Along with it, you will also be able to understand the areas that need a little expenditure trimming.
	</li>
	<li>
	Take Advantage of Government-Run Programs - Government-funded programs like Pradhan Mantri Awas Yojana can be a big help. If you belong to the middle income group (MIG), you will get added assistance on your home acquisition/construction of a house. Check out this <a href="https://pmaymis.gov.in/">link</a> to see what might be available for you.
	</li>
	<li>
	Use Gift Funds - Although gift funds may look like an unconventional way, in the end, every penny counts. You can ask your family and friends to gift you cash that can add up to your down payment.
	</li>
</ul>

<h2 class="credit_i_h2">Increase your Modes of Income&nbsp;</h2>

<ul class="banklogin_ul">
	<li>
	Become a Freelancer
	</li>
</ul>

One of the legit options to mint more money is by signing up on websites like Elance, Upwork, and Guru. You can pick up any job ranging from researching, writing to data entry. A few hours working online during weekends could help you earn some extra bucks.

<ul class="banklogin_ul">
	<li>
	Sell Your Stuff
	</li>
</ul>

Maybe, it's time to get rid of those <a href="https://www.mymoneykarma.com/travel-lifestyle/index.htmlindex.html/overcome-phobia-of-buying-pre-owned-items.html" target="_blank">unwanted items collecting dust</a> all over your home. Get on OLX or eBay for some extra cash.

<ul class="banklogin_ul">
	<li>
	Get Behind the Wheel.
	</li>
</ul>

If your driving record is spick and span, you could get paid to drive passengers with Uber, Ola, or Rapido.

<ul class="banklogin_ul">
	<li>
	Reap Benefits from Your Hobbies.
	</li>
</ul>

Monetize your hobbies by selling them online through Instagram or Etsy. Alternatively, you can even consider catering for your neighbor's party if you like cooking, or you could offer to tutor lessons to the neighboring kids.&nbsp;

<ul class="banklogin_ul">
	<li>
	Leverage the Space in Your Place&nbsp;
	</li>
</ul>

If you have a little extra space in your apartment or house, you can sign up for Airbnb and earn some extra cash.

<h2 class="credit_i_h2">Lifestyle Shift&nbsp;</h2>

A little tweaking in your lifestyle would help you save some extra bucks for the down payment.&nbsp;

<ul class="banklogin_ul">
	<li>
	Workout at Home&nbsp;
	</li>
</ul>

Canceling your gym membership can help you get those extra thousand bucks you need. Instead, you can try <a href="https://www.mymoneykarma.com/travel-lifestyle/index.htmlindex.html/cheap-ways-to-burn-calories-at-home.html" target="_blank">running or exercising at home</a>.&nbsp;

<ul class="banklogin_ul">
	<li>
	Monitor those Subscriptions
	</li>
</ul>

Have you ever tried to find out how many streaming services you pay for?

AltBalaji? Netflix? Amazon Prime?&nbsp;

Cutting down on these subscription luxuries could save you a considerable amount each year.

<ul class="banklogin_ul">
	<li>
	Shop Smarter
	</li>
</ul>

Slashing <a href="https://www.mymoneykarma.com/travel-lifestyle/index.htmlindex.html/save-money-on-groceries.html" target="_blank">your grocery budget</a> can power up your savings. Making a grocery list will help you avoid impulse buys. You can even start buying items in bulk to save up. Take advantage of sales and <a href="https://www.mymoneykarma.com/travel-lifestyle/index.htmlindex.html/use-of-online-coupons.html" target="_blank">coupons</a> to leverage your savings.

<ul class="banklogin_ul">
	<li>
	Plan Meals at Home
	</li>
</ul>

With almost no time, <a href="https://www.mymoneykarma.com/credit-cards/index.html/best-credit-cards-for-dining.html" target="_blank">dining out</a> seems more like a compulsion after a long day at the office. However, eating out can lead to overspending. Instead, you can plan your meals at home to save plenty by planning and budgeting for your weekly food purchases.&nbsp;

<ul class="banklogin_ul">
	<li>
	Change Your Commute
	</li>
</ul>

If you live close to your work, you can ride your cycle. Or else, you can commute by public transport or even take advantage of carpool <a href="https://www.mymoneykarma.com/buying-a-home/index.html/index.html/benefits-of-money-manager-app.html" target="_blank">apps to save some extra bucks</a>. If you are a woman, you've got <a href="https://www.mymoneykarma.com/travel-lifestyle/index.htmlindex.html/daily-commute-options-for-indian-women.html" target="_blank">other options</a> as well.

<h2 class="credit_i_h2">A Few More Money-Saving Ideas</h2>

<ul class="banklogin_ul">
	<li>
	e-file Your Taxes
	</li>
</ul>

Did you know you can save money if you e-file your taxes? You can. After all, it's a nice chunk of change to put directly into your down payment savings account.

<ul class="banklogin_ul">
	<li>
	Go On a Spending "Diet"
	</li>
</ul>

You can put yourself on a 30-day spending diet by limiting your expenses to only essential purchases. Every week, you can save by depositing the money that you planned to spend elsewhere.

<ul class="banklogin_ul">
	<li>
	Automate Your Savings
	</li>
</ul>

One of the easiest ways to save more money into your down payment savings account is by automating it. Just set it and forget it.

<ul class="banklogin_ul">
	<li>
	Follow The 52-Week Rule
	</li>
</ul>

The 52-week rule is an easy way to build your savings, steadily. The rule is simple: Start by saving Rs.10 on the first week, Rs 20 on the second week, and so on. So, by the time you get to week 52, you will be saving upto Rs.520, which adds up to a considerable amount.

<ul class="banklogin_ul">
	<li>
	Take Advantage Of Credit Card Reward Points
	</li>
</ul>

You can start using your <a href="https://www.mymoneykarma.com/credit-cards/index.html/credit-card-reward-points.html" target="_blank">credit card reward points</a> and perks to make purchases. Those rewards points or cash-back bonuses can help you save on everything from groceries to <a href="https://www.mymoneykarma.com/travel-lifestyle/index.htmlindex.html/frequent-flyer-programs-india.html" target="_blank">airline miles</a> to hotel stays (cutdown on the last two though - you’ve got money to save).

<ul class="banklogin_ul">
	<li>
	Cut The Biggest Expenses
	</li>
</ul>

If you want to save big, you will have to <a href="https://www.mymoneykarma.com/buying-a-home/index.html/index.html/kill-the-will-to-splurge.html" target="_blank">cut the biggest expenses</a> rather than cutting down small purchases. Though, they will add up, the tiny cuts never add up enough to save for a down payment.

<h3 class="credit_i_h3">The Bottom Line</h3>

Everyone dreams of a home of their own. But the down payment acts as a roadblock in making it a success. Although saving up may seem impossible at first, you can follow several unconventional ways to raise enough for your down payment.

Haven't applied for your&nbsp;home loan yet? <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">Apply right away</a> with mymoneykarma. We promise not only a hassle-free process, but also the best interest rates from across banks.

&nbsp;

Arranging the funds for a down payment for a home loan can be a long and painful process. Here is mymoneykarma for helping you to buy a home.

How to Arrange down Payment for Buying New Home

We get it. You’re in your 20s. By default, you are jumping around like a gazelle. Good for you.

Given that you have come to this page, however, let's get straight to the point. You need money to buy a home, and a mortgage seems to be the only solution. But you’re in your 20s. Can you even get one at this age?

The answer is yes. Well, here we can safely assume that another question would be bugging you at this point - how does one get a mortgage in their 20s?

It isn't an impossible task to achieve; all you have to do is set a goal. Whether it is related to studying abroad or wanting to <a href="https://www.mymoneykarma.com/buying-a-home/index.html/best-time-to-buy-home.html" target="_blank">buy a home</a>, treat it as a long term goal, and prepare for it accordingly. Here, mymoneykarma has listed some points, considering which can help you in getting a mortgage:

<h3 class="credit_i_h3">Have a Regular Source of Income</h3>

Income is an essential factor that decides your eligibility for any loan. For instance, if your income is Rs.25000, you won't be eligible for getting a home loan of Rs.20,00,000. Your <a href="https://www.mymoneykarma.com/loans/debt-to-income-ratio.html" target="_blank">debt-to-income ratio</a> would be abysmal.

Hence, before you think of borrowing mortgage, you must have a substantial source of income to achieve your goal.

<h3 class="credit_i_h3">Pay Taxes Diligently</h3>

If your income is taxable, <a href="https://www.mymoneykarma.com/taxes/index.html/why-do-we-pay-income-tax.html" target="_blank">pay the taxes</a> on time, as the banks and other financial institutions consider <a href="https://www.mymoneykarma.com/taxes/index.html/what-is-form-16.html" target="_blank">Form-16</a> and <a href="https://www.mymoneykarma.com/taxes/index.html/5-reasons-to-file-itr.html" target="_blank">ITRs</a> of at least three years to approve the loan.

<h3 class="credit_i_h3">Build Credit at an Early Age</h3>

Your <a href="https://www.mymoneykarma.com/credit-scores/index.html/what-is-credit-score.html" target="_blank">credit score</a> can decide whether the lender should take the risk of lending you money or not. For building good credit, you need to begin credit activities at least a year before applying for a mortgage.

If you have had a student loan and paid your EMIs diligently, then you don't need to worry. However, if you don't have a credit history yet, then get a credit card to start building it. A <a href="https://www.mymoneykarma.com/credit-cards/index.html/secured-vs-unsecured-credit-cards.html" target="_blank">secured credit card</a> would be best to start out.

<h3 class="credit_i_h3">Keep Your Payment History Clean</h3>

Once you get a credit card, use it responsibly. <a href="https://www.mymoneykarma.com/credit-cards/index.html/pay-off-credit-card-debt.html" target="_blank">Pay your bills on time</a> and set an auto-debit facility to save yourself from paying any penalties on missed or <a href="https://www.mymoneykarma.com/credit-scores/index.html/how-late-payments-impact-credit-score.html" target="_blank">late payments</a>.

<h3 class="credit_i_h3">Save Money for Downpayment</h3>

Whether your goal is to study abroad or to buy a home before turning 30, it's vital to <a href="https://www.mymoneykarma.com/buying-a-home/index.html/arrange-down-payment-for-buying-new-home.html" target="_blank">save money for a down payment</a>.&nbsp;&nbsp;

For getting an education loan of above Rs. 4,00,000, you need to make a down payment of 15% for studying abroad; whereas, in a home loan, only 80% of the amount is disbursed by the lenders.

<h2 class="credit_i_h2">To Sum Up</h2>

As we said earlier, getting a mortgage in your 20s to accomplish your goal isn't an impossible task if you plan for it. However, you should repay the mortgage on time to maintain your credit health and keep your achievement intact.

Need to apply for a home loan?&nbsp;<a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">Apply right away</a> with mymoneykarma. We promise not only a hassle-free process, but also the best interest rates from across banks.

 Wondering how to get a mortgage in your 20s? Read this blog on the mymoneykarma website to get the solution.

Buying a New Home: How to Get a Mortgage in Your 20's

Buying a new home is enough to get anyone excited. Whether that&rsquo;s because of the monetary scale of the transaction, or due to the size of the property brought, or due to the fact that it is the <a href="https://www.mymoneykarma.com/buying-a-home/tips-for-first-time-home-buyers.html" target="_blank">very first property</a> one is buying is tough to tell. It could well be a culmination of all these factors. Buying a home costs money. In most cases, people need to take loans for making such a purchase. Therefore, this means paying interest in addition to the principal amount. For the common man, making such a purchase through a <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">home loan</a> is a huge investment. Fortunately for the common man, the Government of India is actively interested in making this dream come true for all. To that end, it encourages people to purchase homes by giving them a host of benefits like home loan <a href="https://www.mymoneykarma.com/investing/fixed-income-investments.html" target="_blank">tax deductions under section 80C</a>, and various tax benefits under central government schemes like the Pradhan Mantri Jan Dhan Yojana. These solve the problems of property accessibility and affordability. In this article, we are going to show you top 6 home loan benefits. These are: &nbsp;
<ul class="banklogin_ul">
<li>
Deduction for the interest paid on housing loan
</li>
<li>
Deduction of interest paid on home loan during a property&rsquo;s pre-construction
</li>
<li>
Deduction in the payment of the principal amount
</li>
<li>
Deduction for registration charges and stamp duty
</li>
<li>
Addition deduction under the section 80EE
</li>
<li>
Addition deduction under the section 80EEA
</li>
</ul>
&nbsp;
Let us now see each of these, one by one.
<h3 class="credit_i_h3">Deduction on interest paid on home loan</h3>
There are some prerequisites and conditions before you can get any deduction under this heading. Firstly, and this is a very basic one, you have to use the home loan only for <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">buying a home</a>, and for nothing else. Secondly, the property&rsquo;s construction needs to be finished 5 years from the end of the year on which the home loan was taken. Thirdly, EMIs that you pay every month is not just the interest but both the principal and the interest. You can apply for a tax deduction on the interest part of the EMIs paid over the course of the year. This deduction can be to a maximum amount of Rs. 2,00,000 per year, according to Section 24. When it comes to self occupied and let-out properties, the maximum amount of tax deductible interest is Rs. 2,00,000. However, in this case, you can only claim the deductible amount if the construction is complete.
<h3 class="credit_i_h3">Deduction of interest paid on home loan during a property&rsquo;s pre-construction</h3>
So, you get deduction on interest paid for home loan taken for a fully constructed property. However, what happens when you have already taken the home loan for an under-construction property, and are paying EMIs every month? Does this mean that you can&rsquo;t get any deduction or tax benefits as the property is under-construction?&nbsp;
Not at all! Here&rsquo;s why. According to the rules and regulations of income tax, you are eligible for claiming tax benefits for EMI interest on under-construction properties as well. This is called the Pre-Construction interest and is made as deductions of 5 equal installments from the year in which the property was bought or constructed.
This is above the tax deduction that you are eligible for the property&rsquo;s income. However, remember you can only apply for a tax deduction under this heading to a maximum of Rs. 2,00,000.
<h3 class="credit_i_h3">Tax deduction on principal repayment</h3>
More good news! You get tax deduction on not just the interest paid, but also on the principal repayment under Section 80C. However, the maximum amount that you can claim is Rs. 1.5 lakhs.&nbsp;
There are a few conditions as well: You cannot sell off the property within 5 years of buying it. If you do, deductions already made shall be added back to you at the time of property sale.
<h3 class="credit_i_h3">Tax deductions for registration charges and stamp duty</h3>
Did you know that even the amount you spend on the home loan stamp duty and registration charges are tax deductible? It&rsquo;s true. Under Section 80C, these are tax deductible, but to the limit of Rs. 1.5 lakhs. The catch? You can only do so on the year in which these have occured.&nbsp;
<h3 class="credit_i_h3">Tax deductible amounts under Section 80EE</h3>
It seems that the Indian Government is bent on helping home buyers.&nbsp;
Under Section 80EE, you get an additional deduction. However, just like with all other things, this comes with a few conditions as well. For instance, the loan amount cannot be more than Rs. 35 lakhs. Secondly, the total value of the property cannot be more than Rs. 50 lakhs. Thirdly, such a home loan needs to have been sanctioned between 1st April 2016 and 31st March 2017. Fourthly, on the day this loan is sanctioned, the candidate should not own any other homes. The money deductible is to a maximum of Rs. 50,000.
<h3 class="credit_i_h3">Tax deductible amounts under Section 80EEA</h3>
This allows you to have upto Rs. 1,50,000 deductible. However, to claim this, the property&rsquo;s stamp value should not be more than Rs. 45 lakhs. Secondly, the loan needs to have been sanctioned between April 2019 and March 2020. Thirdly, on the day of the loan sanction, the candidate should not own any other home. The fourth condition is that the candidate should not have availed the benefits under Section 80EE.
<h2 class="credit_i_h2">FAQs</h2>
How can I get a loan for a house?
To get a home loan, you need a <a href="https://www.mymoneykarma.com/credit-score.html" target="_blank">credit score</a> of 580 or higher. This gives you a chance at an FHA-insured mortgage that comes with a downpayment requirement of just 3.5%. However, you&rsquo;ll need to give a downpayment of 10% if your credit score is in the 500-579 range.
Can I take 2 home loans?
There are two main conditions. The first condition is that the property in question should be completely free from legal problems. Secondly, the borrower needs to be capable of repaying both loans.
What is the tax benefit on second home loan?
You can get deduction for interest payable on loan for construction, repair and renovation under the Section 24B of the Income Tax Act.
<h2 class="credit_i_h2">To Sum Up</h2>
As you have seen, you can save a fair amount when purchasing a new home with a home loan. Thanks to the section 80E and its subheadings, you can save money through sizeable tax deductions.
Why wait? <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">Apply for a home loan</a> right away with <a href="https://www.mymoneykarma.com/">mymoneykarma</a>. We offer the best interest rates from across banks, not to mention a smooth and hassle-free process.

Everyone loves to save money. But did you know you can save tax on home loans too? Here are top 6 home loan tax benefits from mymoneykarma.

Home Loan Tax Benefits | Claim Tax Deduction on Home Loan

In 2017, the interest rates of home loans dipped down to the lowest level in six years when SBI cut down the rate of interest to 8.6% from 9.10% and reduced the MCLR or Marginal Cost of Lending Rate to 8% from 8.9%. This slump in rates gave an <a href="https://www.mymoneykarma.com/buying-a-home/index.html/best-time-to-buy-home.html" target="_blank">opportunity of buying homes</a> at a cheaper rate to all new borrowers.

Along with the public sector banks, some private sector banks also joined the league. The slash in lending rates has been a pillar of support in the 'Affordable Housing for All' scheme announced by the honorable Prime Minister of India, Mr. Narendra&nbsp;Modi, in the same year. A home loan lets you borrow a lump-sum amounting to at least 80% of the property value, and you can repay it in the form of Equated Monthly Instalments or EMIs on a monthly basis.

As per the new guidelines of RBI, now banks are required to apply the MCLR method to calculate the rate of interest. For home loan schemes with floating interest rates, the rate can be changed half-yearly or yearly. A reduction in MCLR is a boon for <a href="https://www.mymoneykarma.com/buying-a-home/index.html/tips-for-first-time-home-buyers.html" target="_blank">first-time borrowers</a> as home loans connected to MCLR for a year in fixed rate means that the rate will be the same for the whole year.

However, for the old loans that were borrowed at a higher base rate, it is helpful only after the end of the one year lock-in period. To avail the benefit of the new MCLR, the borrowers of old loans need to start a fresh contract with the bank. 
Other banks that had declared the rate cut in the same year were State Bank of Travancore, IDBI Bank, and Indian Overseas Bank. India Bulls Housing Finance had also subsidized their home loan offerings.

<table class="table table-bordered credit_i_table">
	<tbody>
		<tr>
			<td>MCLR in 2017</td>
		</tr>
		<tr>
			<td>Bank MCLR(%) Previous Rates</td>
		</tr>
		<tr>
			<td>Union Bank 8.65 9.3</td>
		</tr>
		<tr>
			<td>IDBI Bank 9.15 9.3</td>
		</tr>
		<tr>
			<td>SBI 8 8.9</td>
		</tr>
		<tr>
			<td>SBT 9.2 9.4</td>
		</tr>
		<tr>
			<td>PNB 8.45 9.15</td>
		</tr>
		<tr>
			<td>Indian Overseas Bank 9.15 9.5</td>
		</tr>
		<tr>
			<td>Difference 8.6% 9.10%</td>
		</tr>
		<tr>
			<td>Loan 50 Lakh 50 Lakh</td>
		</tr>
		<tr>
			<td>Years 15 15</td>
		</tr>
		<tr>
			<td>Interest(overall) 39 Lakh 42 Lakh</td>
		</tr>
		<tr>
			<td>EMI Rs. 49,530 Rs. 51,101</td>
		</tr>
		<tr>
			<td>EMI is reducing by Rs. 29,000 on Rs. 1 Lakh with effect to this reduction.</td>
		</tr>
	</tbody>
</table>

<h3 class="credit_i_h3">Interest Rate of All Leading Banks in 2018</h3>

The interest rate of home loan varies from one bank to another, depending on the location of the property, the loan amount, and the monthly income of the borrower. There are many banks that offer a concession for women. The range of interest rate starts from 8.50% and extends to 12%.

<table class="table table-bordered credit_i_table">
	<tbody>
		<tr>
			<td>Banks Providing Home Loans</td>
			<td>Interest Rates(Onwards)</td>
			<td>Processing Fees</td>
			<td>Prepayment Charges</td>
		</tr>
		<tr>
			<td>YES BANK</td>
			<td>9.35%+</td>
			<td>0.5% of loan amount or Rs.10,000 (+ GST)</td>
			<td>NA for the floating rate</td>
		</tr>
		<tr>
			<td>State Bank of India</td>
			<td>8.70%+</td>
			<td>Rs. 0 Rs. 10,000</td>
			<td>NA</td>
		</tr>
		<tr>
			<td>HDFC Bank</td>
			<td>8.80%+</td>
			<td>Up to 0.5% of the loan amount</td>
			<td>NA</td>
		</tr>
		<tr>
			<td>ICICI Bank</td>
			<td>8.85%+</td>
			<td>0.5% Rs. 1.00% of loan amount.</td>
			<td>NIL</td>
		</tr>
		<tr>
			<td>IDFC Bank</td>
			<td>8.90%+</td>
			<td>Rs 10,000</td>
			<td>NIL</td>
		</tr>
		<tr>
			<td>India Bulls Housing Finance</td>
			<td>8.70% +</td>
			<td>Up to 1% of the loan amount</td>
			<td>NA</td>
		</tr>
		<tr>
			<td>LIC Housing Finance</td>
			<td>8.50%</td>
			<td>For up to 1 Crore - Rs 5000, Above 1 Crore- Rs 10,000</td>
			<td>NIL</td>
		</tr>
		<tr>
			<td>PNB Housing Finance</td>
			<td>8.99%</td>
			<td>Up to 1% of the loan amount</td>
			<td>NA</td>
		</tr>
		<tr>
			<td>DHFL</td>
			<td>8.70%</td>
			<td>Up to 1% of the loan amount</td>
			<td>NIL</td>
		</tr>
		<tr>
			<td>Axis Bank</td>
			<td>8.70%</td>
			<td>Up to 1% of the loan amount</td>
			<td>NA</td>
		</tr>
		<tr>
			<td>IDBI Bank</td>
			<td>9.30%</td>
			<td>0.5% of the loan amt.</td>
			<td>NIL</td>
		</tr>
		<tr>
			<td>Tata Capital</td>
			<td>8.70%</td>
			<td>0.2% of loan amt.</td>
			<td>NA</td>
		</tr>
		<tr>
			<td>PNB</td>
			<td>8.85%</td>
			<td>Nil</td>
			<td>NIL</td>
		</tr>
		<tr>
			<td>Bank of India</td>
			<td>8.70%</td>
			<td>Minimum Rs.1000 and Maximum. Rs. 20,000</td>
			<td>NIL</td>
		</tr>
		<tr>
			<td>Syndicate Bank</td>
			<td>8.75%</td>
			<td>Minimum. 500 to Maximum. Rs.5,000</td>
			<td>NA</td>
		</tr>
		<tr>
			<td>Canara Bank</td>
			<td>8.70%</td>
			<td>Varies depending on applicant profile</td>
			<td>NIL</td>
		</tr>
		<tr>
			<td>UBI</td>
			<td>8.65%</td>
			<td>Varies depending on applicant profile</td>
			<td>NA</td>
		</tr>
		<tr>
			<td>IIFL</td>
			<td>8.75%</td>
			<td>0.75% of the loan amount (Min. Rs. 5,000)</td>
			<td>NA</td>
		</tr>
	</tbody>
</table>

<img alt="Cheapest Home Loans in India" src="../../images/new/personal-finance/cheapest-home-loans-in-india.jpg" class="img-responsive credit_i_img">

<h3 class="credit_i_h3">Home Loan Interest Rates for Women</h3>

<table class="table table-bordered credit_i_table">
	<tbody>
		<tr>
			<td>The slab of Home Loan</td>
			<td>Interest Rates (% per annum)</td>
		</tr>
		<tr>
			<td>For Women* (up to 30 Lakhs)</td>
			<td>8.70-9.20</td>
		</tr>
		<tr>
			<td>For Others* (up to 30 Lakhs)</td>
			<td>8.75-9.25</td>
		</tr>
		<tr>
			<td>For Women* (Above 30 Lakhs)</td>
			<td>8.80-9.30</td>
		</tr>
		<tr>
			<td>For Others* (Above 30 Lakhs)</td>
			<td>8.85-9.35</td>
		</tr>
	</tbody>
</table>

<h3 class="credit_i_h3">How to Get the Lowest Interest Rate on Home Loans?</h3>

Apart from the enforced interest rate cuts by the banks, there are other ways through which the borrower can get a home loan on lower interest rate: 
 
1. Avail a home loan jointly with your wife and make her the primary applicant of the home loan. Most of the loan provider institutions offer home loan to women on an interest rate that is less by 0.5% of the general interest rate of the same loan.

2. One can also opt for a balance transfer facility and switch to another bank that provides a lower rate of interest if the current bank or financial institution is charging a higher interest rate. In such a fierce competition, banks prefer to retain their customers - especially the ones who make repayments on time and have a good credit report. We at mymoneykarma help you in transferring <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">your home loan</a> to a different financer with favorable interest rates.

You could also <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">apply for a home loan</a> through mymoneykarma! We offer the best, lowest interest rates (sourced from across different banks);&nbsp;as well as a seamless, hassle-free process.

<h3 class="credit_i_h3">Factors that Affect Home Loan Interest Rates</h3>

a. Credit Score -&nbsp;<a href="https://www.mymoneykarma.com/credit-score/credit-score.html?utmsrc=winner1" target="_blank">Your credit score</a> is one of the most critical factors that affect the home loan interest rates. The banks check the credit scores of every borrower of a home loan to assess his/her creditworthiness. The credit score is determined from your credit report which includes the credit history of your loans and credit card repayments.

b. Down Payment - A substantial down payment leads to a lower interest rate. A borrower who pays a considerable amount as down payment and opts for the remaining payment through monthly installments is generally considered a low-risk borrower by the lender. 
 
c. Loan Tenure - The loan tenure is the duration of the loan by which the borrower has to repay the loan. A shorter loan term means lower interest rates and lesser costs, but higher monthly payments. A more extended mandate will result in higher interest payments but lower monthly payments. You can use mymoney's <a href="https://www.mymoneykarma.com/home-loan-emi-calculator.html" target="_blank">home loan calculator</a> to plan your tenure. 
 
d. Types of Interest Rate - Interest rates are of two basic types: Fixed and Floating. Fixed interest rates don't change over time. Floating interest rate varies periodically over the loan term. The banks have their MCLR rate to calculate the interest rate for home loans.

Now, with the interest rate cuts and consequently easy EMI payments, buying a dream home is surely possible.

Why wait? <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry">Apply for a home loan</a> right away through mymoneykarma.

Cheapest home loans in India - how can you get them? Visit the mymoneykarma website to know how you can find the lowest interest rate on a home loan.

Cheapest Home Loan - Home Loan Interest Rate | mymoneykarma

ICICI Bank is a prominent private sector bank in India by consolidated assets. In 2017, the bank had announced a new home loan scheme, which provides borrowers with the benefit of 1% cashback on every EMI paid during the entire loan period. It is a unique offering in the finance industry by ICICI Bank and can be availed for the <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">home loans</a> with a minimum tenure of 15 years.

<h2 class="credit_i_h2">What is ICICI Cashback Scheme?</h2>

The new home loan scheme enables borrowers to choose their preferred mode for cashback, unlike <a href="https://www.mymoneykarma.com/credit-cards/index.html/top-cash-back-credit-cards.html" target="_blank">cashback credit cards</a>. Either the borrowers can utilize the cashback to prepay the loan by getting a reduction in the principal outstanding of the entire <a href="https://www.mymoneykarma.com/icici-bank/home-loan.html" target="_blank">ICICI home loan</a>, or they can receive the credit in their ICICI Bank account.

Both the Indian residents and the NRI borrowers are eligible to apply for the cash back option in a home loan. This scheme is applicable only to the customers who are making the loan repayment through ICICI Bank accounts.

<h3 class="credit_i_h3">Highlights of 1% Cashback Scheme</h3>

<ol class="homeloan_Faqs_ul_1">
	<li>
	It provides the customers with a benefit of 1% cashback on every EMI.
	</li>
	<li>
	It is available for new home loans to resident and NRI customers.
	</li>
	<li>
	The cashback benefit starts from the first Home Loan EMI. However, the first the cashback amount is credited upon the completion of 3 years loan period. After that, the cashback amount is credited subsequently every 12 months until the maturity of the loan period. The cashback offer is available for all the <a href="https://www.mymoneykarma.com/loans/secured-and-unsecured-loans.html" target="_blank">mortgage loans</a>.
	</li>
	<li>
	For NRI customers, the cashback amount can be adjusted as a pre-payment into their loan account only. In this case, the cashback amount cannot be credited in the bank account.
	</li>
	<li>
	It can be availed for completed as well as under construction properties.
	</li>
	<li>
	This scheme is applicable to a minimum loan tenure of 15 years and can be extended to 30 years.
	</li>
</ol>

<img alt="ICICI Bank New Home Loan Cashback Scheme of one percentage" src="../../images/new/personal-finance/icici-bank-new-home-loan-cashback-scheme.png" class="img-responsive credit_i_img"> 
The critical aspects of the new home loan scheme are:

<ol class="homeloan_Faqs_ul_1">
	<li>Loan Amount: It can be any amount as per the standard home loan offering of ICICI Bank.</li>
	<li>Eligibility: Both resident and NRI customers are eligible to apply for this scheme.</li>
</ol>

<h3 class="credit_i_h3">Overview of ICICI Bank &amp; Services</h3>

ICICI Bank offers services to its large customer base with a multi-channel delivery network across 4852 branches, 13780 ATMs, phone banking, internet banking, and the country's first digital bank on mobile called

'PocketsbyICICIBank'. ICICI Bank has the most significant mortgage portfolio. Last year, it had disbursed mortgage loans of over Rs 1 trillion, becoming the first among private sector banks in India to achieve such a milestone. It also introduced few digital initiatives to make the home loan process convenient while delivering the solutions at a faster pace.

Their services comprise home loans on Tab banking, Express Home Loans offering <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">fully online home loan approval</a> in 8 working hours, and subsequent disbursements for under-construction projects through the mobile app.

<h3 class="credit_i_h3">Balance Transfer</h3>

The balance transfer/ <a href="https://www.mymoneykarma.com/credit-scores/index.html/how-refinancing-affect-credit-score.html" target="_blank">refinancing&nbsp;facility</a> is available for mortgage products, such as loans against property, lease-rental discounting, and top-ups on current mortgage loans. However, the customers who have an existing housing loan from other banks or NBFCs can go for a balance transfer facility to transfer from a high-interest loan account to a lower one.

The rate of interest for the balance transfer facility is less, and along with that, the new 1% cashback scheme reduces the loan burden to an extent. So, taking this step can be a boon for the customers.

<h2 class="credit_i_h2">Conclusion</h2>

With the growing fierce competition among the lending institutions and the digitalization in the loan process, many banks are coming up with various profitable schemes to assist customers in <a href="https://www.mymoneykarma.com/buying-a-home/index.html/arrange-down-payment-for-buying-new-home.html" target="_blank">buying their dream home</a>.

mymoneykarma offers great <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">home loan offers</a> as well. there are several benefits to applying for a loan throuh us. Apart from the fact that interest rates are the lowest, the application is smooth and seamless.

Due to such convenient schemes, in today's world, one can easily think of owning a home <a href="https://www.mymoneykarma.com/buying-a-home/index.html/getting-mortgage-in-20s.html" target="_blank">even at a young age</a>.

&nbsp;

Do you know what is ICICI Bank New Home Loan Scheme? If not, here are the experts from mymoneykarma to guide you. Click on the link to know more.

ICICI Bank New Home Loan Cashback Scheme

One of the most important things to do before getting a mortgage is to ensure that you get a much lower interest rate. After all, who wants to pay more than necessary, right? The thing is that interest rates determine the total cost of the mortgage. Getting a lower interest rate means that you’ll have to pay less.

The interest rate is calculated as the percentage payable on your total loan amount. It is also called the mortgage rate.

<hr>
<img alt="SBI Card IPO - Share Quota and Subscription Status SBI plans to raise up to Rs 10,341 crore by selling 13.71 crore shares through its IPO of 'SBI Card'. Separate share quotas were set aside for six different categories of investors — anchor (3,66,69,590 shares), qualified institutional buyers (2,44,46,393 shares), non-institutional investors (1,83,34,795 shares), retail (4,27,81,188 shares), SBI shareholders (1,30,52,680 shares) and employees (18,64,669 shares). Share prices start at 755 per share (with 75 per share discount for employees), with a minimum cutoff of 19 shares to be purchased. Around 40% of the IPO was subscribed on day 1 of the offering itself, and saw a further 55% subscription on day 2." src="https://mmk-s3-cms.s3.amazonaws.com/1583229637603.gif" class="img-responsive credit_i_img">

<h2 class="credit_i_h2">HDFC Home Loan Interest Rate at 6.80%</h2>

<a href="https://www.mymoneykarma.com/hdfc-bank/home-loan.html" target="_blank">HDFC offers Home Loan</a>&nbsp;interest rate of 6.80% for loan amounts up to 30 lakhs for Women Applicants. The offer has been in effect since 11th January, 2021.

This special Housing Loan Scheme is for a limited period only, and can be availed if the loan is disbursed on or before 31st March, 2021. HDFC decides eligibility for the offer based on parameters such as credit scores, segments, details of other loans, etc., and is applicable only for applicants with the <a href="https://www.mymoneykarma.com/buying-a-home/index.html/how-to-improve-your-credit-score-for-home-loan.html" target="_blank">credit score</a> of 730 and above.

The offer can be availed on Home Loans including Home Improvement, Home Extension, and even Refinancing/ Balance Transfer from other lenders.

However, as the offer is applicable only for loans under the ‘Adjustable Rate Home Loan Scheme’, it is subject to change at the time of disbursement. The rates are linked to HDFC's BenchMark Rate. Hence, they are variable throughout the loan period as well.

<hr>
Rates set by lenders can be either fixed or variable. It’s the variable rates that you may want to stay away from, as they are quite unpredictable. Rates fluctuate depending on the market condition. They are also dependent on the loan type and your available funds.&nbsp;

There is yet another way to know how expensive the home loan will be: the APR cost. The APR is the Annual Percentage Rate. It is calculated as a percentage of the entire loan amount and finds out the total cost of the mortgage. The Annual Percentage Rate is composed of lender fees, discounts, interest rates, and various other charges. The APR gives you a bird’s eye view of how much the mortgage is going to cost you each year.&nbsp;

As with any loan you take, a mortgage consists of the principal amount and the interest. The principal is the amount that the lender gives you. The interest is what he earns for providing the principal amount in the first place!

The principal balance decreases over time as you continue paying it back. The interest tends to be high in the beginning, but does down as you keep on paying back the principal.&nbsp;

Here are all the things you need to know to get a lower interest rate!

<h3 class="credit_i_h3">Indicators of Mortgage Rate</h3>

While it may seem impossible to figure out anything about home loan rates, it is not that hard. Even without an advanced education on the financial and banking industry, you can figure it out yourself by two key indicators.&nbsp;

The first indicator is the Prime Rate, which you may also know as India Prime Lending Rate. The Prime Lending Rate stands for the lowest average mortgage rate at which banks are offering credit. Banks use the prime rate for their interbank transactions. Banks also give prime rates of lowest rates to the borrowers they trust the most.&nbsp;

The 10-year central government treasury bond is the second indicator. As its yield rises, the mortgage rate rises as well, and vice versa.&nbsp;

<h3 class="credit_i_h3">Agreeing to a Mortgage Rate</h3>

A lender offering you home loan does not do so without risk. The lender understands that there is a chance that you may not be able to pay back the loan, and takes that into account. If your loan application is seen to be very risky, your interest rate will be appropriately high.&nbsp;

The high-interest rate offsets the risk, as it allows the lender to recover the principal amount faster. However, this interest is not chosen arbitrarily. Lenders pick the rate after studying your income, financial situation, loan type, loan amount, and your creditworthiness.&nbsp;

<h3 class="credit_i_h3">Credit Score</h3>

The credit score is one of the most critical determinants of your interest rate, and thus your loan amount. If you use your credit responsibly and pay bills on time, you’ll have a high credit score. In similar fashion, you’ll have a low credit score when you don’t pay bills on time and don’t use credit responsibly.

Before you even apply for a home loan, make sure that your credit report is in order. Look for administrative errors caused by agency calculations, red flags caused by you such as due accounts, accounts in collections, and late payments. If you do find errors not caused by you, report and dispute them immediately. If, on the other hand, you have caused the negative remarks, correct them soon.&nbsp;

It is essential to understand how your home loan rate is affected by your credit score. Sometimes, you may come across subprime lenders that offer you high-interest loans when they learn you have bad credit; it is better to stay away from them. Knowledge of <a href="https://www.mymoneykarma.com/credit-score/credit-score.html?utmsrc=winner1" target="_blank">your credit score</a> can very well save you from such instances.

<h3 class="credit_i_h3">Employment History and Stable Income</h3>

Your income level and employment history are two critical factors as well. Lenders give the best home loan with the lowest rates to those with exceptional income levels and good employment history. If the records in these two sectors are poor, you can expect lenders to give you high-interest rates. Lenders shall ask you to furnish tax returns for the previous two years as well.&nbsp;

Additionally, the lender could check your employment history by contacting your previous employers. Are their gaps in your employment? Have you been out of work? What is your skill level and profession? All of these could be taken into account.

If you are self-employed, things are a bit more complicated. For instance, you may need to pay higher interest. The rules for the self-employment verification is more stringent as well. All this information is used to find out your debt-to-income ratio.

<h3 class="credit_i_h3">Debt-to-Income Ratio (DTI)</h3>

Before giving you the funds, lenders have a few more things to check, such as your debt concerning your gross monthly income. There are two formulas for calculating this: Front-end Ratio and Back-End Ratio. After these are calculated, and if the DTI ratio is high, your loan application will be declined. This is because a high DTI is considered a sign of you defaulting.

<h3 class="credit_i_h3">Down Payment and Loan-to-Value Ratio</h3>

To get a home loan, you need to make a down payment up-front. Different lenders have various requirements, yet it is agreed that the more you pay as a down-payment, the less your interest rate will be. This is because when you spend a large sum of money upfront, the lender’s risk is mitigated. You also get a lower Loan-to-Value Ratio (LTV). Thus, the lender has no problems in giving you low-interest.

<h3 class="credit_i_h3">Shop for the Best Loans</h3>

Now starts the fun part. You practically go shopping for the best mortgage available. This means that you talk to and compare the various lenders interested in working with you. The one you are looking for offers the best terms and the lower interest rate.

You should also look at the closing costs and fees payable to the lender. Some costs can spiral up quickly if you’re not careful. Stay away from discount ‘points’ and ‘low-closing costs,’ which normally increase the interest rate.

Consider hiring a mortgage agent. It saves you time as well as money. Consider contacting some lenders directly, as well. For a good comparison, check our at least five lenders and their products.&nbsp;

<h3 class="credit_i_h3">Negotiate the Rate</h3>

It is certainly possible to negotiate the rate, but for that, you need to comparison shop. Ideally, you need to have strong credit, employment history, and stable income, as well. This gives you more negotiating power than other borrowers.&nbsp;

<h3 class="credit_i_h3">Lock Your Rate</h3>

If your loan application is accepted, you get the option to lock your lower interest rate. This has both advantages and disadvantages. The benefit is that even if the rate rises in the interim period, you do not need to pay more as the rate is locked. Conversely, if the rate falls, you lose as you still have to pay a higher interest amount. Rate locks remain valid for 60 days. You can apply for an extension, but those are very expensive.

<h2 class="credit_i_h2">In Closing</h2>

It takes a bit of research and comparison shopping to get a good home loan. It is not the only consideration either. You need to pay close attention to the lender’s closing costs. This includes the lender’s fees. All of these items should be listed or outlined on the loan estimate given by the lender.

To avoid all the hassle involved, you can just <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">apply for a home loan</a> through mymoneykarma. Apart from an easy application process, we also offer the best interest rates from across various banks.

However, to ensure that you are getting the best rate and terms, do a bit of comparison shopping. That will put you in a better bargaining position than most of the other borrowers. Doing so shall also alert you about inflated fees, risky loan attributes, and give you better options to choose from.

In closing, a strong credit profile, having low LTV and DTI ratios, stable employment history, and income, makes you attractive to any lender. This means more bargaining power to you.

&nbsp;

About to get a home loan? mymoneykarma shows you how to get the best possible home loan with a lower interest rate.

Apply for a Home Loan  | Home Loan Interest Rates in 2021

<blockquote>
"Can I get a 100% home loan?" "How much home loan can I get in India?" "What are the Documents Required for SBI Home Loan Application?"
</blockquote>
Are all these questions running all over your mind like a thorough-bred steed at a Kentucky Derby? Do you want a home loan buy don&rsquo;t know where to start?&nbsp;
If that&rsquo;s your problem, fret no more! In this article from mymoneykarma, we&rsquo;ll answer all your questions one by one.&nbsp;&nbsp;
But first, we need to get down to the basics...
<h2 class="credit_i_h2">How to get a home loan?</h2>
Want to borrow money? You need to apply for a loan.
Want to buy a dream home but don&rsquo;t have the funds on hand? Not a problem; just <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">get a home loan</a>!
One thing to remember is that home loans require a longer list of documents compared to other loans. This means that the application process can be a bit longer than what you may be used to.
For getting a home loan, here are few criteria and points to remember:
<h3 class="credit_i_h3">Credit and Income</h3>
Your income and credit are primary factors for getting most forms of loans. As such, these have a lot of weight behind whether your application gets accepted or not. So, before you take time to apply for a home loan, its is more prudent to <a href="https://www.mymoneykarma.com/credit-score/credit-score.html" target="_blank">check your credit score</a>.
In case you do find that there are problems like <a href="https://www.mymoneykarma.com/credit-scores/how-late-payments-impact-credit-score.html" target="_blank">late payments</a> which marr your credit score, take steps to correct them first. In such circumstances, the loan can wait.&nbsp;
In fact, with a damaged credit score, you may get disapproved anyways. Even if you are approved by any chance, you&rsquo;ll be sure to get a loan with a large, fat interest rate! Is it not better to apply with a good credit score?
Did I hear a &lsquo;yes&rsquo;? Great!
Some issues you want to look for in your credit report are late payments and <a href="https://www.mymoneykarma.com/credit-scores/remove-negative-credit-report.html" target="_blank">delinquent accounts</a>. If there are instances that <a href="https://www.mymoneykarma.com/credit-scores/remove-credit-report-errors.html" target="_blank">you can dispute</a>, do so.&nbsp;
<h3 class="credit_i_h3">Documentation</h3>
Like we said above, you need more documentation for getting a home loan than any other form of credit. The main reason for this is that lenders have to be sure that you have the means to repay the loan on time. For this, you&rsquo;ll need to provide adequate income proof, the most recent tax return record, along with other documents as may be needed.&nbsp;
<h3 class="credit_i_h3">Debt-to-Income ratio</h3>
One thing your potential lender shall certainly look at is your <a href="https://www.mymoneykarma.com/loans/debt-to-income-ratio.html" target="_blank">debt-to-income ratio</a>. This is to ensure that you&rsquo;ll have enough cash in hand to cover each loan installment. They&rsquo;ll take into account your existing loans and the one you wish to take. This lets them know how much of your monthly income is eaten by loan repayment EMIs.
<h3 class="credit_i_h3">Loan-to-Value Ratio</h3>
It is certainly possible to get a loan with a small <a href="https://www.mymoneykarma.com/buying-a-home/arrange-down-payment-for-buying-new-home.html" target="_blank">down payment amount</a>, but you are more likely to get your application accepted if you make a big down payment. Lenders see how much money you are borrowing in comparison to the net worth of your property. In conclusion, it means that the lesser the amount of money you borrow, the lower the risk to the lender, since smaller loans are easier to repay.&nbsp;
<h3 class="credit_i_h3">Pre-approval</h3>
It is a good idea to know how much can can really borrow even before you start applying. It&rsquo;ll increase your chances. For this, you may want to get pre-approved by a lender. In this preliminary process, your income and credit information is evaluated.&nbsp;
With this information in hand, lenders can give you a rough estimate of the maximum home loan amount which you can get. While it doesn&rsquo;t mean that your application gets approved, pre-approval loan information is certainly useful.
<h3 class="credit_i_h3">How much you should borrow</h3>
In their eagerness to give you a home loan, lenders won&rsquo;t be inclined to tell you just how much you should borrow. At the end of the day, it is your responsibility as a borrower to find out:
<ul class="banklogin_ul">
<li>
How much you should borrow
</li>
<li>
What type of loan you should take
</li>
<li>
How much of a down payment you should give
</li>
<li>
How much you should really spend on the home you want to buy
</li>
</ul>
All of these are central to determining your Loan-to-Value Ratio. These dictate how much your EMIs will be over the loan&rsquo;s life.
To conclude, a small loan is easier to pay off, as the monthly payments and interest charges are smaller. You can borrow the maximum possible amount, but be aware that it&rsquo;ll be more risky. We have just seen what the criteria for getting a home loan are, and how much loan you &ldquo;should&rdquo; take. We&rsquo;ll now come to arguably the most important section, in which you&rsquo;ll find out where you can get home loans from.
<h2 class="credit_i_h2">From where can you get a home loan with ease?</h2>
You can get home loans from a number of sources. For best results, consider getting a quote from three different sources. Consider all three and pick the one that suits you the most. Here are your options:&nbsp;
<ul class="banklogin_ul">
<li>
Mortgage brokers: One of the greatest benefits of approaching a mortgage broker is that you can get home loan quotes from various banks and lenders. Thus, they give you access to multiple sources of finance, along with giving you several other important benefits.&nbsp;
</li>
</ul>
How do mortgage brokers get paid? They either charge you a fee, or charge the lender, or charge both. In case you don&rsquo;t know a mortgage broker personally, ask others like real estate agents for recommendations.
<ul class="banklogin_ul">
<li>
Credit unions and banks: These sources offer attractive loans, including home loans. They loan out amounts, or rather invest them, to you. This is one way they can earn from their funds from various savings and checking accounts. Apart from the loan&rsquo;s interest, they also earn from closing costs and origination fees.
</li>
<li>
Online lenders: They earn from investor funds by lending them. The services of online lenders are convenient as you can get instant quotes. You are also able to handle all the activity online.
</li>
</ul>
<h3 class="credit_i_h3">Your other loan sources are:&nbsp;</h3>
<ul class="banklogin_ul">
<li>
Loan programs: Sometimes, local organizations and the government can help you in getting the home loan you desire, with certain loan programs. These programs enable you to get approved for the loan without much hassle. They also make owning a home more attractive and affordable for many.
</li>
<li>
Government loans: Government loans are the most generous. In this case, you get a loan from a private lender. In case you fail to repay, the government will pay the lender instead of you.
</li>
<li>
First-time home buyer program: If you are <a href="https://www.mymoneykarma.com/buying-a-home/tips-for-first-time-home-buyers.html" target="_blank">buying your first home ever</a>, there&rsquo;s great news. There is something as first-time home buyer program. These programs make it easier to get a home loan. Developed by non-profit organizations and local governments, these facilitate loan approval, down payments, interest rates, etc.
</li>
</ul>
The downside is that these are hard to find and even to qualify for. Furthermore, all of these loans limit the profit you can make from the sale of your home.
That was all the essential background information that you&rsquo;ll need. A bit too much, was it? Perhaps, but you can&rsquo;t deny the fact that it is useful and important.
Let us now answer some of the most commonly asked questions.
<h2 class="credit_i_h2">FAQs</h2>
Can I get a 100% home loan?
Some banks offer as much as 90% of the total value of the property. However, it is also important to know that Loan-to-Value ratio is decided according to the RBI guidelines.
Here&rsquo;s how it works: you get 90% of the loan financed if the amount is upto Rs. 30 lakhs, 80% of the total loan amount is the loan is between Rs. 30 lakhs and Rs. 75 lakhs, and only 75% of the total loan amount when the loan is above Rs. 75 lakhs. This ensures that the major part of the borrower&rsquo;s funding is met.
How much home loan can I get in India?
In general, you may get 85% of the total loan amount against the property&rsquo;s value. However, banks may also look at other criteria apart from the property&rsquo;s value.
Here is a very helpful article that includes the home loan interest rates of the top 10 banks in India. mymoneykarma sources <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">your home loan</a> from across banks, so that you get the best interest rate out there.
What are the Documents Required for SBI Home Loan Application?
SBI is one of the best options for a <a href="https://www.mymoneykarma.com/home-loan.html">home loan in 2022</a>, with the lowest interest rate, of 7.90%. Some of the documents you&rsquo;ll need to submit include the loan application form, three passport-sized photos, ID proof such as Voter ID card, driver&rsquo;s license, Adhar card, etc, and your proof of residence.&nbsp;
<h2 class="credit_i_h2">To Sum Up</h2>
We have learned in this article from mymoneykarma:
<ol class="homeloan_Faqs_ul_1">
<li>
How to get a home loan
</li>
<li>
Criteria for getting a home loan
</li>
<li>
Where you can <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html" target="_blank">get a home loan with ease</a>
</li>
<li>
Where you can get a 100% home loan
</li>
<li>
How much home loan can you expect in India
</li>
<li>
What the documents needed for a home loan are
</li>
</ol>
We hope that this article will be helpful to you when it&rsquo;s your turn to get a home loan. &nbsp;

How to get a home loan? Getting a home loan can be really confusing. That's why mymoneykarma is here to help you through this journey to get a home loan.

How To Get A Home Loan in 2022 | Home Loan Tips | Apply Home Loan

Buying a new home is exciting as well as stressful. While you are super enthusiastic about picking a great location for your new abode and designing its interiors, the financial stress associated with it can be quite strenuous. Assuming that you're planning to buy your dream house on a <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">home loan</a>, you need to keep a spic and span financial record to qualify for the loan and get a favorable interest rate. These ten commandments of getting a home loan can keep you straight and steady on this precarious financial path.

<h3 class="credit_i_h3">1. Thou shalt not change jobs, become self-employed, or quit your job</h3>

As a buyer, you must probably be concerned with various factors - the location of the new house, the interior design, the services available, the proximity to several conveniences, the price, etc. However, the lenders are primarily concerned with one factor - your consistency. If you have quit your job, and you are currently unemployed, you certainly aren't considered creditworthy as you do not have a steady income to repay a loan. The same applies to self-employed people - if you have recently ventured into a new business, there isn't enough data to prove that the business will flourish; hence, lenders wouldn't trust you with new lines of credit. Moreover, you might also end up raising red flags if you change jobs frequently or have an on-again-off-again employment schedule. Such career moves highlight your inconsistency, and lenders consider you a risk. It's best to stay put till the home loan is approved. Change your job after you change your mailing address.

<h3 class="credit_i_h3">2. Thou shalt not buy a car, truck, or van</h3>

Hold off on making sizeable purchases right before applying for a home mortgage. If you, for instance, buy a car on an auto loan just before buying a new house, the dream house may remain a dream, and you might have to live in the car instead. On a serious note, when you're already repaying a considerably hefty debt, potential lenders won't trust you with another. So, space out these purchases to make sure that you have your dream house as well as your dream wheels. This is one of the most important ones of the borrower commandments.

<h3 class="credit_i_h3">3. Thou shalt not use credit cards excessively or let current accounts fall behind</h3>

When you apply for a new loan, the lender checks your <a href="https://www.mymoneykarma.com/loans/debt-to-income-ratio.html" target="_blank">debt-to-income ratio</a> (DTI) to decide whether you qualify for the loan or not. The DTI is an analysis of your monthly income and your existing debt obligations. It tells the lender if you are capable of handling more credit and paying more debt. Excessive credit card usage means that you spend uncontrollably; it indicates your inefficiency in handling credit. Failing to pay bills on time, on the other hand, reflects an irresponsible financial behavior - it warns the lender that you might not be capable of repaying the loan. Both of these habits not only affect your DTI but also <a href="https://www.mymoneykarma.com/credit-scores/index.html/reasons-for-credit-score-drop.html" target="_blank">ding your credit score</a> to a considerable extent. Keep a clean sheet - pay all bills on time and do not open any new lines of credit.

<h3 class="credit_i_h3">4. Thou shalt not spend money that you have set aside for closing</h3>

Keep your hands off the amount you have set aside for closing. If you use it, you lose it. And if you lose it, you jeopardize your ability to pay closing costs. Stick to your budget plan and financial commitments. Howmuchever hard you might be craving for some new and shiny got-to-have-it-today thing, you need to keep the temptation at bay.

<img alt="10 Commandments of a Home Loan" src="../../images/new/personal-finance/10-commandments-of-a-home-loan.jpg" class="img-responsive credit_i_img">

<h3 class="credit_i_h3">5. Thou shalt not omit debts or liabilities from your loan application</h3>

Honesty is the best policy - remember? Well, follow it blindly while applying for your home loan. Be fair and square; do not fudge anything on your loan application. We live in the age of technology, where the internet makes sure that nothing remains hidden. Whether it is an unpaid telephone bill or a tiny glitch in tax payment, a couple of clicks can get the lender all the information he needs. And if you're caught in some funny business, you can bid adieu to your dream home.

<h3 class="credit_i_h3">6. Thou shalt not buy furniture</h3>

A new couch, some fancy chest of drawers, a chic coffee table, a grand chandelier - when you're about to buy a new home, all such attractive furniture and interior decor might catch your attention. While there's no doubt that these items will look fabulous in your new-home-to-be, yet you must remember Commandment 3. <a href="https://www.mymoneykarma.com/buying-a-home/index.html/index.html/kill-the-will-to-splurge.html" target="_blank">Do not splurge</a>. All these goodies can wait.

<h3 class="credit_i_h3">7. Thou shalt not originate any inquiries into your credit</h3>

<a href="https://www.mymoneykarma.com/credit-scores/index.html/hard-inquiries-vs-soft-inquiries.html" target="_blank">Hard inquiries</a> take place whenever a lender conducts a check on your credit while making a lending decision. So, each time you apply for a new line of credit, a hard inquiry happens and knocks a few points off your credit score. A hard inquiry appears on your credit report and remains for seven years. It is an important decision-making factor for potential lenders. A single hard inquiry might not be very appalling, but a bunch of simultaneous hard inquiries can be serious. Take care and make sure that you don't invite unwanted hard inquiries when you are applying for a home mortgage. If you urgently need to see your credit score, get a free copy of your credit report from any one of the credit reporting agencies. If you spot an error on your credit report, <a href="https://www.mymoneykarma.com/credit-scores/index.html/remove-credit-report-errors.html" target="_blank">file a dispute</a> and immediately get it rectified. Your loan request could get rejected due to errors or unnecessary hard inquiries.

<h3 class="credit_i_h3">8. Thou shalt not make large deposits without checking with your loan officer</h3>

What if your Grandpa gifts you a large sum of money to help you with the down payment? Isn't it a great relief! Well, it may not be so. The lender might get suspicious if you suddenly slam down an extra lump sum amount that's more than 50% of your salary towards the down payment. They might assume that you have taken another loan. If you really get into a similar situation, you must ask your grandpa to write a gift letter to the lender; the letter must declare the relationship between the two of you, the total amount of money gifted, the transaction date, and a statement from your Grandpa saying that he is expecting nothing in return.

<h3 class="credit_i_h3">9. Thou shalt not change bank accounts</h3>

You might hate your bank or credit union and desperately want to switch over to a new one. However, with your loan application under process, jumping ship isn't a great idea. It might cut your access to your recent bank statements and prevent you from printing proofs of your income, spending habit or identity. It might upset the entire mortgage process. Be calm and keep your patience - tolerate your current financial institution until you cross the threshold of your new home.

<h3 class="credit_i_h3">10. Thou shalt not cosign a loan for anyone</h3>

When you cosign a loan with someone, you essentially promise to fulfill the financial obligation if the main borrower defaults on the loan. Cosigning a loan is never a great idea. An unanticipated expense can wreak havoc in your finances and curb your ability to pay your own home loan. Would you want to risk foreclosure on your own home if a distant cousin defaults on his auto loan?

<h2 class="credit_i_h2">To Sum Up</h2>

Now that you know what to keep in mind and what to look out for, follow these ten commandments, be confident and apply for your home loan. If you don't budge from these ground rules, you are sure to get a thumbs-up for your home loan application.

Haven't applied yet?&nbsp;Why not <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">apply for a home loan</a> through mymoneyakarma? We offer the best interest rates, as well as a smooth and seamless application process.

Are you planning to apply for a home loan for buying a new home? Before you take the crucial decision, let mymoneykarma help you out - please go through these ten commandments of home loan to know a few important pointers for getting a loan approval.

10 Commandments of a Home Loan | mymoneykarma

Buying a home is an essential life decisions that not everyone can make, and it involves various risks. Earlier, the Generation-X used to save for their entire lives to fund a home after retirement. In today's age, however, irrespective of the affordability, almost all of us have the desire to buy a home. Modern financing solutions have now paved a way for people to arrange for&nbsp;<a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">home loans</a> through various credible lenders.

If you meet the home loan eligibility criteria of any lender, you can easily avail home loans at low interest rates in India. Typically, your eligibility can be supported by factors like&nbsp;<a href="https://www.mymoneykarma.com/credit-scores/index.html/how-to-build-good-credit-score.html" target="_blank"> good credit score</a>, a constant source of income, a clean credit history, and higher value for the property for which the loan is applied. An existing home loan also provides benefits in the form of tax exemption.

<a href="https://www.mymoneykarma.com/credit-scores/index.html/4-tips-for-a-good-credit-score.html" target="_blank">Credit score</a> is an inevitable requirement to assess the creditworthiness of the applicant. It considers the credit and repayment history to determine the person's credibility of not defaulting on payments.

<h3 class="credit_i_h3">What is a Credit Score?</h3>

Fortunately, there is not much confusion regarding credit score meaning. The maximum credit score one can have is 900. The closer your score is to that number, the better you are at paying your debts on time.

The good news is that there are organizations from where you can get your credit score free of cost. Yes, it is true. You can get a credit score check for free. These financial bodies are Equifax, CIBIL, CRIF High Mark, and Experian.

<h3 class="credit_i_h3">Factors That Determine the Calculation of Credit Score:</h3>

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	Repayment History - Repayment history is assessed to determine the transactional record and punctuality of the person in<a href="https://www.mymoneykarma.com/credit-scores/index.html/how-late-payments-impact-credit-score.html" target="_blank"> paying the debt</a> before the due date.
	</li>
	<li>
	Source of Credit - Information from different sources about the person's credit details.
	</li>
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	Credit History - The credit history of the borrower is checked to determine when and how the person has been taking and dealing with credit in the past.
	</li>
	<li>
	Application for Credit - Credit applications are assessed to know how often the person applies for a new line of credit. An application triggers a <a href="https://www.mymoneykarma.com/credit-scores/index.html/hard-inquiries-vs-soft-inquiries.html" target="_blank">hard inquiry</a>.
	</li>
</ul>

<h2 class="credit_i_h2">ICICI Bank Home Loans</h2>

ICICI Bank is one of India's prominent home loan lenders, assisting its customers in purchasing a house by helping them through the process and offering a loan based on the requirement. In this article, mymoneykarma experts take you through some of the essential factors that you must consider before selecting the bank before applying for a home loan.

Choosing the right home at the ideal location and buying it at the best price is indeed a complicated procedure. So, our experts advise all first-time homebuyers to keep all the relevant factors in mind before starting a search. Use reliable sources, such as third-party sites like Housing.com and Magic Bricks, to find your options. Banks like ICICI can help you further with the purchase of both new constructions as well as properties listed for resale.

<h3 class="credit_i_h3">Highlights of Home Loans from ICICI Bank:</h3>

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	It offers loan processing charges of up to 1.00%
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	Lesser EMI amounts
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	Prepayment and foreclosure charges are null for floating rate loans
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	The age groups of 21-60 years (for salaried employees) and 21-65 years (self-employed) are eligible to apply for a home loan.
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	Quick loan disbursal.
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	Exclusive advantages for premium banking customers - The customer can repay the home loan in smaller EMIs over a longer tenure of 30 years, depending on their financial situation.
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	Lucrative interest rates for several categories of home loans.
	</li>
</ul>

<h3 class="credit_i_h3">Advantages of ICICI Bank Home Loans</h3>

The bank keeps including additional benefit schemes in its home loan offerings from time to time. Some of the extended benefits are as follows:

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	ICICI Bank cashback offer of 1% on each EMI of home loan
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	Null repayment charges for floating rate home loans
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	Hassle-free documentation and approval process
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	Housing loans come with tax benefits. However, one must consult a CA or an income tax advisor to learn about the pros and cons involved.
	</li>
</ul>

<h3 class="credit_i_h3">Application Process for ICICI Home Loans</h3>

The applicant can either apply online through the website of ICICI Bank or can call the toll-free number. The bank will start the process after checking the necessary documents, the applicant's credit score, and the value of the property for which the loan is applied for. Once the loan is approved, the borrower will be notified through an SMS and an email. However, remember that you need to have the best credit score for ICICI bank home loan.

<h3 class="credit_i_h3">Documents Required</h3>

For salaried individuals, the following are the documents that the applicant must submit-

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	Application form with a self-attested photograph.
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	Identity, address, and age proof.
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	Last six months' bank statements.
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	Past three months' salary-slips.
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	Processing fee cheque
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	Form-16 or Income Tax Return proof.
	</li>
</ul>

<h3 class="credit_i_h3">Credit Score for ICICI Bank Home Loan</h3>

The best credit score for ICICI bank home loan is 700 and above; the higher your credit score, the lesser is the amount of interest rate you need to pay. If the credit score is over 650, banks might be willing to dispense credit; but either the applicant will be asked to make a heftier down payment, or the bank may approve a lesser amount instead of disbursing the full amount as requested by the applicant.

<h2 class="credit_i_h2">Conclusion</h2>

As home loans are secured loans, there are chances of getting a loan with a low credit score as well, as the security pledged against the loan will play a significant role here. However, it is recommended to have a good <a href="https://www.mymoneykarma.com/credit-score/credit-score.html?utmsrc=winner1" target="_blank">credit score</a> before applying for the loan as it can boost the chances of getting approval.

Consequently, you could pay EMIs at low interest rates. Why don't you check out the ICICI Home Loan 1% Cashback Scheme, which may help you in paying your home loan faster?

You could also <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">apply for a home loan</a> through mymoneykarma. We promise the best interest rates, not ot mention a hassle-free application process.

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ICICI bank home loan eligibility appears to be confusing you? If so, you need to know that the best credit score is needed for ICICI bank home loan. mymoneykarma shows you how.

ICICI Bank Home Loan Eligibility - Home Loan Cashback Offers

Hi there! If you are planning to buy your dream home, it is likely that you are excited and nervous at the same time. After all, it isn't a cakewalk.&nbsp;
There is an enormous checklist to consider before buying a home so that you don't end up becoming a victim of any scam. The good news is, you don't have to go anywhere else to find it, mymoneykarma has consolidated the entire checklist for you. Here it is:
Check Your Eligibility for Home Loan
Pull out your credit report through <a href="https://www.mymoneykarma.com/credit-score/credit-score.html" target="_blank">mymoneykarma</a> to readily assess your credit-worthiness. If your <a href="https://www.mymoneykarma.com/credit-scores/what-is-credit-score.html" target="_blank">credit score</a> is low, then banks may not approve your home loan, or you may have to borrow it at a high interest rate.
Thus, this step should be the first on your checklist before you start house hunting. It will help in negotiating with the bank for a low interest rate.
Find Out Which Kind of Property Serves Your Purpose
A property buyer has three options: resale properties, under-construction homes, and ready-to-move.
A resale property can be apt for you under these three circumstances:
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You want to buy a property that is already furnished by another owner.
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A resale property is available on a good deal as the owner has an urgent requirement.
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You are not getting a new ready-to-move-in house/apartment in your preferred location.
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</ul>
An under-construction property can be suitable for you, if -
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You are ready to pay 5% GST on it (applicable for cost above Rs. 45 Lakhs).
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You can manage to pay rent and EMI at the same time.
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The builder is providing a substantial discount.
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The builder is trustworthy and ready to deliver on time.&nbsp;
</li>
</ul>
Ready to move in properties are the best, if -
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You want to touch and feel the product.
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You want to decide based on the feedback from the existing residents.
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You want to save on rent.
</li>
</ul>
Go for a RERA Registered Property
Whichever the type of property you choose, try not to jump the gun while finalizing it even if you are promised a huge discount.
First of all, check whether the property is registered on the website of RERA( Real Estate Regulation and Development Act 2016) or not. RERA has eased the complexity of property buying by doing most of the legwork.&nbsp;
Hence, if you don't get the details of the developer on its website, it may indicate that the developer hasn't submitted the necessary documents to the authority for approval.
Tracking the history of the delivered projects of a developer can also help you to determine its credibility.
Check for Affordability&nbsp;
Once you select from the list of these three types of properties, use the <a href="https://www.mymoneykarma.com/home-loan-emi-calculator.html" target="_blank">home loan calculator</a> on mymoneykarma to determine the monthly EMIs.&nbsp;
Try to get a pre-approved home loan - Involve the bank at an early stage to figure out the real value of the property and to estimate the amount of downpayment.
While calculating, add other components in the property cost too, such as registration fees, stamp duty, loan processing charges, etc
Negotiate with the Seller&nbsp;
Finalizing the deal on the price that has been proposed by the seller or the real estate developer is not a good idea. You can always negotiate for a better price, elongated maintenance period, and free access to amenities, with the developer/agent.&nbsp;
Be Diligent with the Paperwork&nbsp;
Now we&rsquo;re talking about the final stage - of buying a home. Check the model purchase agreement on the RERA website to comprehend all the clauses, so that the developer does not trick you.
<h2 class="credit_i_h2">To Sum Up</h2>
After completing the entire checklist, you are good to go with your plan of buying a dream home.
We can help make it come true - <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">Apply for a home loan</a> with mymoneykarma right away, and&nbsp;buy yourself&nbsp;an amazing abode!
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Are you a first-time homebuyer? Here are the essential tips that you should consider before buying your home, provided by the mymoneykarma website.

Tips for First-Time Home Buyers | What You Need to Know Before Buying

Hi there! As you have come to this page, let's safely assume that you want to purchase a home of your dreams, but are at a bottleneck in deciding when to take the leap. If so, these could be the reasons behind it -
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You are afraid of becoming a victim of scams in real estate projects
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You have no idea about the real estate market trends
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You hesitate in borrowing a loan
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You still think that your income isn't enough
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</ul>
Well, the crux is that&nbsp;somehow you believe that you need to wait for the right time to buy your home.
Trust us, the 'right time' is a myth. You can take the step whenever the circumstances around you are favorable. For instance, an increase in the tax benefits for home loan borrowers, decrease in interest rates, soaring share prices, salary hike, etc.
Here, mymoneykarma has listed several points that may help you in figuring out the best time to buy your dream home:
Are You Single?
Often, events such as marriage and childbirth are the triggers that lead people to purchase homes. This is quite ironic, as being single is the perfect time to take mortgages and build an asset. It is so because you don't remain overburdened with too many responsibilities at this stage.
Do You Have a Budget?
If you have an annual income that easily lets you pay monthly EMIs and other expenses as well as make savings to assist in downpayment, it indicates a green signal. Go ahead with your plan of turning your dream into a reality.&nbsp;
In case you are afraid of borrowing credit now, then look at it this way; say you liked an apartment costing Rs.1 crore, but you skipped buying it because currently, you don't have a crore in your bank account.
Will you ever be able to buy it again? Sorry, but the harsh truth is that you wouldn't be able to afford the same home after a few years, as real estate prices soar with time.
Are You Averse to Government Scheme Benefits?
No?&nbsp;
Good.
The central government introduced a scheme in 2015 - the Affordable Housing Scheme for All or Pradhan Mantri Awas Yojana - which is active till 2022. This scheme applies to both the urban and rural populations.&nbsp;
According to this scheme, the government offers an interest subsidy of:
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6.5% for Economically Weaker Sections (EWS - households with an income range of ____)
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6.5% for Low Income Group (LIG - 3 Lakhs-6 Lakhs).
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Middle Income Groups
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4% for Middle Income Groups-I (6 Lakhs-12 Lakhs)&nbsp;
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3% for Middle Income Groups-II (12 Lakhs-18 Lakhs).&nbsp;
</li>
</ul>
</li>
</ul>
The eligibility condition to avail this scheme is that&nbsp;you shouldn't have a dwelling unit on your name or in the name of any family member, in any part of India.
If you don't have a home yet, you come under any of these brackets, and are able to manage down payment; then isn't it the right time to buy a home for you?&nbsp;
For people who prefer under-construction properties, the GST has been reduced from 12% to 5% recently, thereby bringing down the overall cost.
Here is the thing - these schemes are temporary. Hence, to get a benefit out of them, you need to take a quick step - this is the right time for you.&nbsp;
Do You Have a <a href="https://www.mymoneykarma.com/credit-scores/4-tips-for-a-good-credit-score.html" target="_blank">Good Credit Score</a>?
If you have a credit score above 700, then there are good chances that you will get approval on the home loan.&nbsp; In case you are a credit card user but haven't checked your credit score yet, then use&nbsp;mymoneykarma's <a href="https://www.mymoneykarma.com/credit-score/credit-score.html?utmsrc=buying-a-home_2090" target="_blank">credit score tracker</a> to pull your credit report.
<h2 class="credit_i_h2">To Sum Up</h2>
We hope the above points have helped you in deciding whether it's the right time to buy your home or not. However, do remember that if you think this isn't the right time, then it will never come, as chances are that the price of a house will always remain higher than your savings.&nbsp;
If you are ready it, <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">apply for a home loan</a> right away with mymoneykarma! We promise you a hassle free process, as well as the best interest rates.
Wish you all the best!
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Wondering, if this is the right time to buy your home or not? Check this blog on the mymoneykarma website to get the answer.

When Is The Right Time To Buy a House

Almost everyone has had a debt at some point in time. These can be personal loans, business loans, mortgage, or its various other types. Our growing, excessive wants, coupled with overzealous credit marketers are at play here. Borrowing is not a problem. However, if one is not able to pay back loans, and if one needs an ongoing series of new loans to pay back the last one, then it is a bad debt spiral.

Because of this, it helps to separate Good debt from the bad debts, which aids in keeping your obligations under control.

Let us first look at what Good debt is.

<h2 class="credit_i_h2">What Is Good Debt?</h2>

You may be confused at this point. After all, we were told that all debt is bad.

So from where on earth does the notion of Good debt come? Can debt be good? And what is bad debt then?

Good debt is something that enables you to make more money. You can practically gain an income through it. Thus, good debt is very similar to an investment.

One more good thing about it is that it has very low rates of interest.

<h3 class="credit_i_h3">Are There Any Examples of Good Debts?</h3>

Home loans are a great example. These are cheap and easier to get in the market. Home loans also come with several tax benefits. When you buy a home, you are getting an asset. This asset can give you more money in the future through value appreciation.

Another example is an education loan. Getting a good education will pay off in the long run. Getting a loan for education is a good investment, and also a Good debt. 
Types of Good Debt

Some types of good debt are:&nbsp;

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	Mortgage
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	Student loan
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	Small business loan
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	Credit cards
	</li>
</ul>

<h3 class="credit_i_h3">Are Good Debts All That Good?</h3>

Good debts are excellent as long as you use them well. The problem arises when there are too many good debts. What happens is that people often overextend themselves.&nbsp;

For instance, a couple may take a loan to buy a dream house that is well beyond their means. Even when they get such a loan, it leaves very little monetary maneuvering space. There may not be enough funds for meeting an emergency, as they would need to sacrifice a significant part of their income to pay back the loan.

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The solution? Make down payments of 20% of the property at least, while limiting borrowings to a minimum.

Now that we have learned about Good debt, it is time to learn about bad debts.

<h2 class="credit_i_h2">What are Bad Debts?</h2>

Bad debt, as the name suggests, is the opposite of Good debt. While the latter creates more money for you, the former leads you to depreciating assets. A car loan is a classic example of this.

Car’s by themselves have value depreciation. Did you know that the moment you buy a new car, its value depreciates by 20%?

Consumer loans, personal loans, and credit card loans are also examples of bad debts. When you buy anything that you otherwise can’t afford with a consumer loan is bad debt. It is not a smart financial move either.&nbsp;

Paying your credit card bills on time is excellent, but not so when you start delaying the payments. In the latter instance, it also adversely affects your credit score.

<h3 class="credit_i_h3">Don’t Use Good Debts to Pay off Bad Debts</h3>

It may seem normal to get a new loan to pay off a previously taken loan, but it is not a smart thing to do. You may get a lower interest rate when you get a remortgage, for instance, but that will not be a smart financial decision. This is because your home will still be kept as collateral, meaning it will be taken away in case you are not able to repay this loan. The second problem is that a remortgage stretches out your repayment period.

While you can surely consolidate multiple debts, doing this puts your most prized assets at risk.

<h3 class="credit_i_h3">Keep an Eye on Your Debt-to-Income Ratio</h3>

You need to keep an eye on this ratio as well, because this is one factor that directly affects your Credit Score. A good rule of thumb is to make sure that EMI payments are 35% of your take-home income.

<h2 class="credit_i_h2">To Conclude</h2>

Hardliner economists and financial experts may say that all debts are bad, but that is not true. It all comes down to the type of loan, and how you use it. There are good loans, after all.

Try to use loans only to improve your earning potential and to invest further for your future. Using these for instant gratification is not the way to go.&nbsp;

It is much more prudent to keep debts within safe limits. That way, debts won’t affect your savings.

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Can't tell the difference between Good debt and bad debt? Want to know about the different typess of good debt, or to get out of debt? Read this article at mymoneykarma.

Difference Between Good Debt and Bad Debt

Purchasing your first home can be exciting. However, it can also be nerve-wracking for a first time home buyer. This is because there are many variables to consider. For instance, you need to consider the right place, the right amount of loan or mortgage, and several other things. As you may know, currently there are fewer home listings in several local markets, due to which the price of the same properties are rising as well. With such a scenario, it can be challenging to get a new home.&nbsp; 
This may make you feel like the decision needs to be made right now! But believe us, doing so rarely brings any good. There are a few things you need to consider before doing so. For instance, you need to see whether your finances are in order. You also need to visit a few houses to select the most appropriate one. Other things you need to consider include the health of your credit history, your credit score, your financial situation, and your debt-to-income ratio. 
Mistakes made by first time home buyers mostly fall within the realms of actually purchasing and of getting a mortgage. 
Here are the mistakes to avoid when buying a new home.

<h2 class="credit_i_h2">3 Mistakes to Avoid When Buying a New Home</h2>

<h3 class="credit_i_h3">1) Failing to keep tabs on your credit</h3>

Nasty surprises cropping up while buying a home can be pretty unpleasant, to say the least. For instance, you decide on a house but then discover that you and your wife have a glaring credit problem. In such a situation, chances are your credit application will be rejected.&nbsp;

Credit issues include late payments, considerable credit debt, debt collection issues, and others. Either way, any of these instances can be pretty frustrating. To ensure that you have no credit issues, check your credit report at least twice a year. Doing so will tell you about any administrative mistakes and your own credit issues if any. You can check your Credit Report from the three Credit Bureaus, namely Equifax, Transunion, and Experian. 
If you find any mistakes or errors, get back to the concerned agency with the appropriate documentation and proof. If you do find genuine negative items, know that you cannot remove these before 7 years at least. What you can do instead is pay your bills on time, make sure that you’re not maxing out your credit limit, and pay more than the minimum monthly payments.

If you have a low credit score, please be patient. It can take upto a year to see a positive change in your credit score. When it comes to buying a new home, your credit score is very important. If the score is below 620, most lenders will refuse your mortgage.

<h3 class="credit_i_h3">2) Looking for loans before you’ve been pre-approved</h3>

Most sellers won’t even consider your offer to buy a property if you do not have a pre-approval letter. The letter is important as it shows that you have finances enough to pay the bills based on your credit score and credit history, employment history, income, financial assets, and other variables.&nbsp;

This document also shows the amount of loan for which you qualify, along with the loan program, interest rate, and down payment amount as estimated by you. Some lenders, in addition to this document, may also want proof of your available funds for the estimated down payment.&nbsp;

Remember that the pre-approval letter has an expiry date, which is usually 90 days.

<h3 class="credit_i_h3">3) You don’t hire a real estate agent</h3>

Sometimes people think they don’t need a real estate agent, and can search for and purchase a home on themselves. Most of the time, this does not prove to be possible. This is because the process is complicated and takes a lot of your time. The best thing to do is to hire a real estate agent. An agent not just helps you in finding a property, but also in negotiating with the seller. The best thing is that you often don’t need to pay him as a first time home buyer. He shares the commission with the seller’s agent from the fees given by the seller. 
If you avoid these mistakes, you can get a new home with ease. If you have been careful and ready, why not apply for a home loan from mymoneykarma? The whole process is seamless and extremely convenient, not to mention the low rates of interest on offer. Check your <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry">eligibility</a> right away.

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Want to know which mistakes to avoid when buying a new home as a first time home buyer? Check out this blog by mymoneykarma.

First-Time Home Buyer | Mistakes To Avoid When Buying A Home

<h2 class="credit_i_h2">Getting a mortgage - Piece of Cake; or Is It?</h2>

If only mortgages were easy to get! It is everyone’s dream to walk away with a mortgage in a jiffy. But in reality, it does not work like that. It can be pretty tough to get a mortgage. There can be several things that are capable of being an obstacle. These include low credit score, insufficient income level, too much debt, and inadequate downpayment.

However, they are not unsurpassable.&nbsp;

In this blog, we are going to help you in overcoming these. Here’s how you can do that.

<h3 class="credit_i_h3">Repair and Increase Your Credit Score</h3>

You could be a model from a top beauty magazine or an enthusiastic entrepreneur with grand lifestyle plans, but lenders won’t pay a penny if your credit score is poor. Only the credit score matters! 
If your <a href="https://www.mymoneykarma.com/credit-score/credit-score.html" target="_blank">credit score</a> is high, you can get the best loans, but if it is too low you may not get a single one. However, if your score is low, don’t worry. There are ways to raise it. It may not be immediate, but it shall be sustainable. 
For instance, if your credit score is lower than 630, lenders may not entertain you at all. Score downwards from 620 are considered subprime. Few lenders shall give loans at such a score.

Now, in the rare case in one does get a loan despite having a poor credit score, it is no matter to celebrate. The problem is that such loans come with high rates of interest and other unfavorable terms. A person takes such loans when he or she has no choice.

Ideally, you should aim to have a credit score of 740 or above. In such cases, you can get a mortgage and other loans at highly favorable terms and conditions. For instance, you’ll get the best or lowest interest rate.

Here are the ways to raise and repair your credit card score. You can do this by paying off your loans, by using your credit card less and your debit card more, by paying bills on time each month, and by finding and correcting errors on your credit report.&nbsp;

However, do understand that not every problem in your credit report and credit score can be repaired quickly. Some take as much as 7 to 10 years. These include collection accounts, foreclosure, charge-offs, and very late payments.&nbsp;

Additionally, if you are about to apply for a mortgage or are thinking of investing in one, do not take any new credits. Applying for new credit lowers your credit score, as taking too much credit at the same time is a warning sign to the lenders. They believe that, as you can many loans available, you may not be able to make the mortgage payments after a time.

<h3 class="credit_i_h3">Get a Job That Pays You More</h3>

Sometimes, lenders may say that your income level is not high enough to get the mortgage. In such cases, start by asking them how much more is needed. You can then ask at your current company if your salary can be increased.&nbsp;

Lenders prefer higher salaries as it means that you are more likely to repay the mortgage and not default. They want to see that you have steady employment. It is better to not change professions while having applied for a mortgage.

Switching professions may bring more salary increase, but lenders discourage it. What you can do instead is switch companies in the same industry or profession. You may not be able to get a raise in the current job, but a new employer may have more to gain by absorbing you.

If switching companies night now is not viable, there are other things you can do to be more valuable at the current company. You can upgrade your skills and take a role with more responsibility, and hence a higher salary. Get help from a career counselor to help in increasing your marketability and reach your income goals.

Part-time jobs are not taken into consideration by lenders as they are seen as temporary. Mortgage repayment takes at least 15 years. What lenders are looking for is long-term income stability.

<h3 class="credit_i_h3">Start Saving Like Crazy</h3>

When you have a mortgage to pay back, you can’t spend like crazy. You’ll have to save up a lot. Till you pay back, you may have to live a frugal life. To start with, start making a list of things you can do to maximize your savings. Are you getting secondary or recurring income from somewhere? If so, can you increase that amount? A mortgage may seem tough to pay back when your cash inflow is low. However, it is not impossible.&nbsp;

<h2 class="credit_i_h2">To Sum Up</h2>

We’d like to end by saying that it is not easy to get a real estate mortgage. Sometimes, lenders set a high bar which you must pass to get approved. However, it is not impossible either. If you follow these tips above, your journey to get a mortgage should be easy.

Want to make it way easier? <a href="https://www.mymoneykarma.com/home-loan.html">Apply for a home loan</a> through mymoneykarma right away!

&nbsp;

Investing in a mortgage or taking a real estate mortgage is harder than it sounds. Before making this lifestyle choice, have some mortgage advice from mymoneykarma.

Steps to Scoring a Mortgage in 2021

<h2 class="credit_i_h2">Mr. Vikram’s Story</h2>

It was nearly midnight. The night was deep and all quiet, yet in his mind, Mr. Vikram was so worried that he couldn’t sleep a wink. Resigning himself to the fate that he possibly would not get to sleep tonight, he got up and called up his closest friend. 
His friend was certainly surprised at getting a call so late at night. That was when Mr. Vikram said that he was worried about the high monthly EMI that’d start soon. He had just taken a personal finance home loan for moving to his dream home. His friend patiently understood his problem and offer a bit of sound advice. 
A few months later, Mr. Vikram was saving nearly Rs. 5,000 per month. That same year, he saved a total of more than Rs. 50,000! 
What brought about his huge change? 
Let us show you the things he did!

<h3 class="credit_i_h3">Castles in the Air&nbsp;</h3>

As adults, most of us dream of owning a fantastic dream home, a place that we can call our own. A place where we can raise a family. Perhaps these are things you are looking for when seeking a home, or perhaps you seek one where you can retire peacefully. 
Purchasing a home is a considerable investment. In fact, it is one of the biggest investments in your life. Most people depend on low-interest loans for making such purchases, and thus they count on banks and housing finance companies.&nbsp; 
A home loan’s principal amount is higher than others, such as personal and car loans. Due to this, it can be a problem for a borrower to repay the home loan through EMIs.

<h3 class="credit_i_h3">What Determines Your Home Loan’s EMI?</h3>

The main determinants of your home loan’s EMI are:

<ol class="homeloan_Faqs_ul_1">
	<li>
	Payable interest rates
	</li>
	<li>
	Tenure of loan
	</li>
</ol>

Mr. Vikram’s problem was that his EMI payments exceeded 50% of his income. Being the single earner of his family, that was problematic. After the monthly payments, there was not sufficient money left to invest in other things and for paying monthly bills. Financial experts advise that the EMIs should always be less than 50% of your monthly income.

<h3 class="credit_i_h3">So What Magic Did MR. Vikram Spin?&nbsp;</h3>

Interest is always calculated on the outstanding amount. Thus, when Mr. Vikram started to pay a higher EMI each month, he was able to pay off the loan faster. More importantly, his interest rate went down! Of course he had to hold back on investments and indulgences for a certain period, but it was definitely worth the sacrifice. 
Here’s a mistake that a lot of people tend to make. It is true that buying a home is a good investment as it gives higher returns in the long term. However, it also means that the home loan borrower needs to choose a longer loan repayment period. 
As you can understand, this has a negative compounding effect, as the borrower becomes stuck. He or she has to pay more when the overall interest was covered. 
Do what Mr. Vikram decided to do. 
Pick a shorter loan repayment duration. When you repay the loan faster, your interest rates decrease.

Here are the things that he did to save Rs. 50,000 in one year! 
Mr. Vikram:&nbsp;

<ul class="banklogin_ul">
	<li>
	compared rates online
	</li>
	<li>
	made a bigger down payment&nbsp;
	</li>
	<li>
	prepaid part of the loan before the end of tenure, which reduced the interest rate&nbsp;&nbsp;
	</li>
	<li>
	increased his EMI payments annually with an increase of his net income per year
	</li>
	<li>
	paid extra EMIs when he received increments and annual bonuses, which saved interest and aided in repaying loans faster
	</li>
	<li>
	switched to MCLR, which has the benefit of lower interest rates
	</li>
</ul>

Mr. Vikram is glad that he made the choice to go the extra mile when it came to repaying his loan. Not only could he save a lot of money, but he can also close his loan earlier now.

<h2 class="credit_i_h2">To Sum Up</h2>

Will taking these steps help you in reducing your home loan interest rate? Certainly!

Want to know who else helps?

Us! 
mymoneykarma helps you to save your hard-earned money on a home loan with this <a href="https://www.mymoneykarma.com/home-loan-emi-calculator.html">home loan emi calculator</a>. Also, if you found this information useful, you’d also be glad to know that mymoneykarma offers home loans as well - that too at the lowest interest rates. <a href="https://www.mymoneykarma.com/home-loan.html">Apply</a> right away! 
&nbsp;

Learn all about home loan, EMI intererest rates, personal finance, and mymoneykarma's home loan emi calculator. Also get our home loans!

Home Loan: How to Reduce Interest on Home Loan 

When you buy a home with a mortgage, it is natural to want to pay off the mortgage early instead of letting it hang over your head like the Damocles Sword for years and years. This can be especially disconcerting when you are preparing for retirement. Naturally, you want to to pay off all your dues as early as possible. 
However, before you even start thinking of using your savings, inheritance, and a raise from your job to pay the mortgage off early, it is important that you take a few steps back to determine whether doing so will prove beneficial or not. As you will learn, there are several <a href="https://www.mymoneykarma.com/buying-a-home/index.html/commandments-of-home-loan.html" target="_blank">Do’s and Don’ts to a home loan</a>. 
Here’s something for you to know: the amount you save on interest on paying off your mortgage early may not be more than your earnings if you had invested the same money elsewhere instead of early repayment. In such a case, early repayment is not that financially sensible, right? 
However, there is also the thing that early repayment of your mortgage gives you a lot of peace of mind. After all, after paying off the loan, you are now free to profit from other investments, and you don’t have to worry about the monthly investments. 
To help you to make a decision, here are a few things you need to know, courtesy of mymoneykarma:

<h2 class="credit_i_h2">Is using money for investing better than early mortgage repayment?</h2>

So what really happens when you decide to invest your money somewhere else?

Richard Bowen, CPA and the owner of Bowen Accounting, California, says that it not just makes more sense but it is also more financially viable to invest somewhere else.

Here’s what happens: 
Most mortgages have interest rates between 3.5% and 5.5%. This means that the returns you can get after an early repayment is generally the same as your interest rate. This is lackluster to say the least. On the other hand, the annual returns for S&amp;P 500 is around 10%. 
In addition, while making such investments, you can take out the cash from dividends etc. to start paying off your mortgage and thus transfer it into a cash-flow positive property. These have a potential to get greater returns in the long term.

However, here’s a word of caution: Investments may give greater returns and interest rates, but also carry risks. You can invest a lot on the market and end up losing it. Even investing in real estate is not without risks. 
There’s a potential downside to paying off the <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">home loan</a> early on as well.

After an early repayment, the price of the property takes a plunge, leaving you in considerable loss. After all, buying a home is investing in real estate too. 
So at the end of the day, consider carefully which road you’ll take as both have certain risks.

<h2 class="credit_i_h2">Do you want all your money to be tied up in repaying mortgage?</h2>

Before you decide to use a large part of your savings to repay the mortgage early, consider the liquidity factor. A property is a non-liquid asset. It can take years to sell it off for some capital. 
You are depleting your cash reserves - money that you may need later on - for early repayment of the mortgage. 
A possible solution: 
Here’s a good solution for such situations, but it’ll need some planning and consistent effort on your part. You’ll have to build an emergency fund, in addition to <a href="https://www.mymoneykarma.com/investing/index.html/grow-your-money-by-investing-in-mutual-funds.html" target="_blank">mutual funds</a>, treasury bills, <a href="https://www.mymoneykarma.com/investing/index.html/stock-market-vs-mutual-funds.html" target="_blank">stocks</a>, marketable securities, and other tangible assets. 
Thus, while you are giving money for early repayment, you’re also investing money in <a href="https://www.mymoneykarma.com/investing/index.html/guide-to-save-tax-2019.html" target="_blank">tax-advantage</a> retirement accounts and the property, thereby having enough liquid cash from investments to have liquid cash in case of emergencies. 
It is best to have a 6-month safety cushion to protect yourself during emergencies.

<h2 class="credit_i_h2">So how will you want to use the money if not for early mortgage repayment?</h2>

Time to be brutally realistic. If you don’t use the money for an early mortgage repayment, where will you use it?&nbsp;

If you struggle to keep money intact in the bank, or if you have a habit of spending money quickly, it may make more sense to pay off the mortgage early. 
An early repayment of your mortgage will save you thousands in interest over time, and shall additionally help you build a property equity faster.

<h2 class="credit_i_h2">How important is peace of mind to you?</h2>

Let’s face it. Sometimes, peace of mind is the only thing that matters.

It brings a great deal of mental peace to know you don’t have to pay mortgage EMIs anymore, and that now your funds are not tied down. For those saving for retirement, this is very true. 
Doing so may not carry much financial potential, but peace of mind can certainly not be measured in terms of money. Paying back the home loan means you can:

<ul class="banklogin_ul">
	<li>
	Establish a home equity faster
	</li>
	<li>
	Develop an emergency fund or emergency income source
	</li>
	<li>
	Make home improvements sooner
	</li>
</ul>

So what do you think? Is it more worthwhile to pay off the <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry" target="_blank">mortgage</a>, or to <a href="https://www.mymoneykarma.com/investing/index.html/" target="_blank">invest</a> instead?

&nbsp;

Does it make sense to pay off your mortgage early? Or should the money be invested? This can be so confusing to loan borrowers. Fortunately, mymoneykarma helps solve the puzzle for you.

Paying Off Your Mortgage Early? | Mortgage Loan

Rarely have you felt so apprehensive. 
 
You’re actually dreading applying for a home loan. 
 
Why? 
You do not want to apply for a home loan with an inadequate <a href="https://www.mymoneykarma.com/credit-scores/index.html/what-is-credit-score.html">credit score</a>, only to see the application being rejected and experiencing a fall in your credit score to boot! 
I mean, that’d be really unpleasant. It’d be like rubbing salt on injury. 
Fortunately, it’s mymoneykarma to the rescue!

In this article, we are going to show you several ways to <a href="https://www.mymoneykarma.com/credit-scores/index.html/how-to-improve-credit-score.html">improve your credit score</a> for home loan application.

Let’s jump right in.

<h3 class="credit_i_h3">1. Check your credit report</h3>

When you <a href="https://www.mymoneykarma.com/credit-score/home-loan-credit-score.html?utmsrc=homeloan_enquiry">apply for a home loan</a>, a lot of processes go on unbeknownst to you. For instance, just after you make the application, the bank or the lender checks out several essential criteria. These are:

<ul class="banklogin_ul">
	<li>
	A steady income
	</li>
	<li>
	How much <a href="https://www.mymoneykarma.com/buying-a-home/index.html/arrange-down-payment-for-buying-new-home.html">downpayment</a> you can make
	</li>
	<li>
	Your credit history
	</li>
</ul>

But why should you check your credit<a href="https://www.mymoneykarma.com/credit-score/credit-score.html"> </a>report? 
Because, my friend, it helps you to find out anything that is suppressing your credit score. This can be anything from an unpaid EMI to a loan default. 
Don’t worry though! Your checking of your credit report is not going to affect it adversely. This is something called a <a href="https://www.mymoneykarma.com/credit-scores/index.html/hard-inquiries-vs-soft-inquiries.html">Soft Inquiry</a> that has no effect on your credit score. 
Now, back to the point: you know by now how important it is to check your credit score before applying for a home loan. 
But where can you check it? 
You can do so from the three credit bureaus namely Experian, TransUnion and Equifax. You can <a href="https://www.mymoneykarma.com/credit-score/credit-score.html">get a free copy of your credit report</a> once a year from all three of them.

So far so good? Fantastic! Let’s move on.

<h3 class="credit_i_h3">2. Dispute inaccurate information</h3>

A big reason to check your credit report is so that you may find inaccuracies in the calculations. Sometimes, the credit bureaus make mistakes in the calculations. Credit bureaus compile or develop millions of credit reports a year. Thus, a mistake in the calculations can happen in anyone’s report. 
Now, if you do find such errors, you can and should <a href="https://www.mymoneykarma.com/credit-scores/index.html/remove-credit-report-errors.html">dispute it</a> by contacting the concerned credit bureau. A lingering error can make a big difference in your credit score, which can spell doom to your home loan application. This is why it is essential to remove inaccurate information. 
Didn’t miss that payment? Go for a dispute resolution. 
Didn’t default on your last loan? Get in touch with the credit bureau. 
Didn’t take too many loans within a short time? Holler out loud!&nbsp;

However, they won’t be making any corrections just because you tell them to. You need to show proof! So gather all the required proof before going for a dispute resolution with a credit bureau.

<h3 class="credit_i_h3">3. Pay off delinquent accounts</h3>

Maybe you already have creditors, or have taken some loans already. Doesn’t matter. But what does matter is that you pay them consistently and timely. 
Whatever you do, make sure that there are no delinquent accounts. These murder your chances of getting any loan. Delinquent accounts include bills in collection, late accounts, judgments, and charge-offs. 
This is why you need to pay them off, especially before applying for a home loan. 
But there are already delinquent accounts in my credit report! 
Take a deep breath. Take a few more. Now, what you need to do is to <a href="https://www.mymoneykarma.com/credit-scores/index.html/remove-negative-credit-report.html">get rid of this delinquent account</a> first by paying it back.

Once done, wait for 6 months. By this time, the fact that you have paid off the delinquent account shall reflect on your credit score.

That’s a good time to make a home loan application.

Now, granted that waiting 6 months to make a home loan application can be a long time, especially when the need is dire, but trust me. You won’t want to go headfirst applying for a loan when your credit score is unsatisfactory due to delinquent account records.

<h3 class="credit_i_h3">4. Reduce your debt-to-income ratio</h3>

If you have a high <a href="https://www.mymoneykarma.com/loans/debt-to-income-ratio.html">debt-to-income ratio</a>, banks are going to question your ability to pay back loans. 
The ideal debt-to-income ratio is 12%. The lower this ratio is, the easier it will be for you to get a loan. 
But what is the debt-to-income ratio? 
Let’s say that your income is Rs. 10,000. Your debt EMI per month is Rs. 4000. This means that your debt-to-income ratio is 40%. 
Now that you know that a debt-to-income ratio is, here’s something important. Make sure that the ratio is not more than 43%. 
And last but not the least:

<h3 class="credit_i_h3">5. Don’t incur any new debts</h3>

Most lenders may refuse you any loan even if your debt-to-income ratio is less than 12% of your total income. In other words, they see existing debts in a negative light. Because of this, till your mortgage is secured, you must consider not to take any new credit, including <a href="https://www.mymoneykarma.com/credit-cards/index.html/applying-for-a-credit-card.html">applying for credit cards.</a>

<img alt="SBI Card IPO - Share Quota and Subscription Status SBI plans to raise up to Rs 10,341 crore by selling 13.71 crore shares through its IPO of 'SBI Card'. Separate share quotas were set aside for six different categories of investors — anchor (3,66,69,590 shares), qualified institutional buyers (2,44,46,393 shares), non-institutional investors (1,83,34,795 shares), retail (4,27,81,188 shares), SBI shareholders (1,30,52,680 shares) and employees (18,64,669 shares). Share prices start at 755 per share (with 75 per share discount for employees), with a minimum cutoff of 19 shares to be purchased. Around 40% of the IPO was subscribed on day 1 of the offering itself, and saw a further 55% subscription on day 2." src="https://mmk-s3-cms.s3.amazonaws.com/1583229637603.gif" class="img-responsive credit_i_img">

<h2 class="credit_i_h2">HDFC Home Loan Interest Rate at 6.80%</h2>

<a href="https://www.mymoneykarma.com/hdfc-bank/home-loan.html" target="_blank">HDFC offers Home Loan</a>&nbsp;interest rate of 6.80% for loan amounts up to 30 lakhs for Women Applicants. The offer has been in effect since 11th January, 2021.

This special Housing Loan Scheme is for a limited period only, and can be availed if the loan is disbursed&nbsp;on or before 31st March, 2021. HDFC decides eligibility for the offer based on parameters such as credit scores, segments, details of other loans, etc., and is applicable only for applicants with the&nbsp;credit score&nbsp;of 730 and above.

The offer can be availed on Home Loans including Home Improvement, Home Extension, and even Refinancing/ Balance Transfer from other lenders.

However, as the offer is applicable only for loans under the ‘Adjustable Rate Home Loan Scheme’, it is subject to change at the time of disbursement. The rates are linked to HDFC's BenchMark Rate. Hence, they are variable throughout the loan period as well.

<h2 class="credit_i_h2">FAQs</h2>

What is a good credit score for home loan? 
A credit score that’s between 700 and 760 is considered to be moderate. However, that depends on the lender. With a score in this range, you can get home loans easily but a slight rate of interest.

Can I get a home loan with 700 credit score?

Yes. With a score of 700, you can get almost all home loans. As you reach 740 and beyond, you can get any of them. The terms and interest rates just get better as your credit score increases.

How can I improve my credit score to get a mortgage?

Here are a few things you can do to improve your credit score before getting a mortgage:

1) Dispute errors and inaccurate information

2) Pay off debts and delinquent accounts

3) Make timely payments to bury delinquencies

4) Bring down your debt to income ratio

5) Check your credit score regularly

6) Do not acquire&nbsp;new new debt

<h2 class="credit_i_h2">To sum up</h2>

So there you have it! Not one, not two, but 5 ways to increase <a href="https://www.mymoneykarma.com/credit-score.html">your credit score</a> (or at least to prevent it from dropping). With these strategies, it shall be easier to maintain a healthy credit score before <a href="https://www.mymoneykarma.com/home-loan.html">applying for a home loan</a>.

Want to get a home loan but your credit score is too low? Want to know how to increase your credit score for getting mortgage? Find out in this article from mymoneykarma.

How To Improve Your Credit Score For Home Loan

Want to buy your dream home but don’t have the funds in cash? Well, you can still make it by getting a mortgage.

<h3 class="credit_i_h3">So what exactly is a mortgage?&nbsp;</h3>

It is an agreement between the bank and the borrower. The lender or the bank provides the mortgage in return of the property as collateral. 
Here’s what happens in the case of a mortgage: When you decide to take a mortgage to buy a property, the lender gives you the money (provided you are approved). However, there’s a condition - the property you wish to buy shall be kept as a collateral. Such an agreement is fair to the lender, as there is no risk for their investment. And yes, their lending you is a sizable investment. 
Now, here’s the important thing: when you take a mortgage, you are legally giving the lender permission to take the property in a foreclosure. This means that they can move you from your home forcibly in case you are not able to pay back.

The sale of this property shall be used by the bank to refill its coffers.

<h3 class="credit_i_h3">Mortgage and home loan - how are they related?</h3>

Is a mortgage the same thing as a home loan? In most cases, they are similar.

These two terms are used interchangeably quite often. In the technical sense, a mortgage is the agreement that actually makes getting a home loan possible. This means that unless you have a mortgage, there’s no home loan coming either.

In case of real estate transactions, you have to get the agreement in writing. This agreement is a legal one and gives the power of foreclosure to the lender.

In the next section, we’re going to cover the various types of mortgages.

<h3 class="credit_i_h3">Types of mortgage</h3>

Whenever you think of the term mortgage, you thought there’s just one type of mortgage, right? Well, that is not true. Actually, it has multiple types. 
While it may seem to make things much more complicated, all this segmentation actually allows you to pick the one you really need.&nbsp;

Fixed-rate mortgage: This is the simplest form of loan. You’ll be making the same payment for the entire duration of the loan, unless of course you pay more to get rid of the debt faster. It often has a term of 15 to 30 years.&nbsp;

However, you may also come across others with shorter or longer loan repayment periods. Here’s something to remember: the longer your term is, the more you’ll ultimately pay.

Adjustable rate mortgage: These are similar to fixed rate mortgage, but there’s a big difference. The interest rate is variable and can change in the future. 
As you can understand, when your interest rate increases, so does your monthly payment. That’s certainly not a good thing.&nbsp;

However, the opposite is also true. If the monthly interest rate falls, you’ll have to to pay less. You won’t be seeing such sudden changes from one month to another, though. You’re more likely to see this difference over the course of years. Adjustable rate mortgage is considered risky because there’s no way to predict where your interest rate will be in 10 years. 
Home equity loans or second mortgages: These are not exactly for buying a new home. These are for borrowing funds by keeping your existing home as a collateral. To take a second mortgage, you put a new one on top of the existing one.&nbsp;

Now, here’s the thing -&nbsp;your second mortgage remains in second position. This means that it will be paid only if there is any money left over after the first mortgage loan provider is repaid. Often, this type of mortgage is used to pay for higher education and home improvements.

Reverse mortgage: These are generally paid to homeowners who are over 62 years of age. Candidates needed to have strong home equity. This type of mortgage is sometimes used by retirees to supplement their existing income, as well as to get funds from cash out properties what they have paid off a long time back.

Here, borrowers don’t pay the bank or the lender. They are instead paid by the lenders. The loan needn’t be paid back until the home is sold or vacated. 
Interest-only loans: In the case of interest-only loans, you have to pay just the interest costs per month. This means that your monthly payments shall be smaller since you are not repaying any loan balance.&nbsp;

However, there is a drawback: you’ll have to repay the debt at some point of time as you are not paying down the debt and are building home equity. As you can understand, interest-only loans make sense in the short-term, but are not a good option for those hoping to build wealth.&nbsp;

Balloon loans: This mortgage is different as these require you to give a big “balloon” payment. In this type of loan, you need to make a considerably large one-time payment to remove your debt, instead of making the same payment over a large period of time. Typically, after taking this loan, you’ll have to repay the amount after 5-7 years. Balloon loans are good for getting temporary financing. However, the risk is that you may lack the funds you need when it comes to repaying the loan.

Refinance loans: These are a special sort, as they allow you to swap mortgages if you find a better offer or deal.&nbsp;

Here’s what happens: when you refinance a mortgage, you get a new one that takes care of the old one. In other words, you use the new mortgage to pay off the old one. This may seem like a good thing, or you may think that you can continue taking one mortgage after another indefinitely, but it does not work that way.&nbsp;

Due to the closing costs, the process can be very expensive. However, the loans in question don’t need to be of the same type. That allows for some flexibility.

Knowing the different types of mortgage can certainly be helpful. Imagine walking into a bank for a mortgage. You tell the bank’s rep that you’re looking for a mortgage. The rep asks you which type you are looking for. And that stumps you! You thought there’s just one.

...Well, not anymore!

<h2 class="credit_i_h2">FAQs</h2>

What are the 3 types of mortgages?

Actually, there are more than 3 types. There are as many as 6 types and sub-types of mortgage.These include: 
Fixed Rate Mortgage (30-year mortgage, 20-year mortgage, 15-year mortgage), Adjustable Rate Mortgage (Variable Rate Mortgage, Hybrid ARMs, Option ARM), Balloon Mortgage, Interest-Only Mortgage, Reverse Mortgage, Combination Mortgage, Government-Backed Mortgage, Second Mortgage, and others.&nbsp;

Why is a mortgage called a mortgage? 
The word ‘mortgage’ is actually derived from a French law term. It is supposed to be developed or penned first in the Middle Ages in England. The term ‘mortgage’ from then is supposed to refer to ‘death pledge’ as the loan payment obligation is fulfilled only when the money is paid back, or when the borrower’s property is taken away through foreclosure, or when the borrower has passed away.&nbsp;

How do I get a mortgage loan?

Here are a few things that you can do: 
1) Know your credit score and understand why it is the way it is 
2) Keep your job 
3) Save money 
4) Avoid new debt and pay back the old ones 
5) Get pre-approved for a mortgage 
6) Choose to buy a home that you can realistically get

<h2 class="credit_i_h2">To Sum Up</h2>

In this article from mymoneykarma, you have learnt:

<ol class="homeloan_Faqs_ul_1">
	<li>
	What is a mortgage?
	</li>
	<li>
	Difference between a mortgage and a home loan
	</li>
	<li>
	Types of mortgage
	</li>
</ol>

We hope that you have enjoyed reading this article just like we enjoyed compiling this information for you.

&nbsp;

What is a mortgage? Is it the same as a home loan? How is your credit score related to your loan application? mymoneykarma tells you in this article.

What Is A Mortgage ? | Types Of Mortgage Loans In India

<h2 class="credit_i_h2">RBI cuts Repo Rates, allows 3-month moratorium on loans to safeguard economy from pandemic</h2>

In an emergency move on Friday, 27th March 2020, the Governor of the Reserve Bank of India, Mr. Shaktikanta Das has slashed - by 75 basis points - its key lending rate. This measure was taken to counter the toll the coronavirus is currently taking on the Indian economy.

The meeting, which was originally scheduled for a bi-monthly policy meeting in April, was changed to an unscheduled emergency meeting of the RBI Monetary Policy Committee. This move was voted for by 4 out of 6 members of the committee.

According to the Governor, “The economic outlook globally is uncertain and obviously negative... Financial stability is the topmost priority of the RBI in this crisis.”

<img alt="Governor of the Reserve Bank of India, Mr. Shaktikanta Das" src="https://mmk-s3-cms.s3.amazonaws.com/1585314434250.jpeg" style="height:375px; width:667px" class="img-responsive credit_i_img">

Here are the key take-aways things to keep in mind:

<ol class="homeloan_Faqs_ul_1">
	<li>
	The Repo Rate is the key interest rate of the RBI. It is at this rate that it gives short-term loans to commercial banks. Now, in this situation today the repo rate cut was of the largest magnitude ever done so far. Previously, the largest cut delivered was 35 basis points in August 2019.
	</li>
	<li>
	Additionally, a 100 basis point cut was announced in the Cash Reserve Ratio for 1 year. This step is taken to ensure that there will be adequate liquidity system-wide. Cash reserve ratio is the amount of money in cash banks have to keep with the RBI. This step is to release liquidity as much as Rs. 1,37,000 crores in all banks.
	</li>
	<li>
	A 3-month moratorium period on loans is presented by the RBI to banks and other lenders. This is done to ensure that there is enough credit flow. This stage will benefit banks as well as the common man by allowing them a relief in these hard times.
	</li>
	<li>
	According to Mr. Das, the priority now is to have ‘strong and purposeful action“ for protecting the Indian economy in its fight against Covid-19. The economic outlook globally is uncertain and obviously negative... Financial stability is the topmost priority of the RBI in this crisis
	</li>
	<li>
	&nbsp;The step to change the repo rate was taken to safeguard the Indian economy at a time when the coronavirus is visibly affecting the industry.
	</li>
	<li>
	The Governor or the RBI has reassured citizens by saying “Indian banking system is safe and sound... In spite of the challenging environment, I remain optimistic.”
	</li>
	<li>
	The Reserve Bank Of India has already given a stimulus package to the industry, in the form of Rs. 2.7 lakh crore to India’s financial system. This step was carried out after RBI’s February policy meeting. The RBI’s current liquidity injection ratio to the country’s GDP is 3.2%. Mr. Shaktikanta Das further says that if any other steps are required to be taken to safeguard that Indian economy, they shall be taken. On Thursday, 26th March 2020, 1.7 lakh crore as a fiscal package was provided to support the poor through food security measures and direct cash transfers. However, details as to how this would be implemented was not provided.
	</li>
	<li>
	Currently, India is looking at the lowest GDP expansion since the global financial crisis of 2008-2009. Many economists predict a bigger blow to the economy because of the coronavirus outbreak.
	</li>
</ol>

<img alt="Indian GDP is going down : global economic crisis 2020 " src="https://mmk-s3-cms.s3.amazonaws.com/1587983315746.jpeg" style="height:640px; width:960px" class="img-responsive credit_i_img">

However, even the moratorium period offered by RBI has come under question as of late. Moody's opines that the loan moratorium could cause a greater build-up of credit loss for banks. India and China have both extended such measures to deal with the liquidity crunch amid the COVID-19 crisis. Although this can provide temporary relief to borrowers, it will constrain banks from taking proactive recovery actions and could lead to an even greater build-up of credit loss once the moratoriums are lifted, reports Moody's.

Moody's, in a report on the Asia-Pacific region on Tuesday, said that while policy stimulus will shore up credit quality for larger companies in sectors including airline and oil and gas, Asia's banking sector profitability would decline from falling asset quality and lower net interest margins.

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3 Months of EMI relief for the people! The RBI Governor has announced a 3 month moratorium on all loans, while also announcing the largest repo rate cut in recent history. 

Latest RBI Update : Allows 3 Months Pause on EMI - RBI Repo Rate Cut

You have bought a home. You are excited to set foot in your new home.

However, a new journey awaits you right after you pay the new property’s closing costs and have tipped the movers. As the new owner, you need to budget for it as well.

<h3 class="credit_i_h3">Basics of budgeting as a new homeowner</h3>

If you don’t know how to create a budget, we’ll help you out. Start with the 50/30/20 budgeting approach. It gives a good foundation. In this budget plan, 50% of your income goes to meeting your needs, 30% towards meeting your wants, and 20% towards repaying your debts and savings. Perhaps it’ll help to use a budget calculator and a budgeting app.

If you are not new to all this, start with the following.

<h3 class="credit_i_h3">Plan to meet the new regular expenses</h3>

You are already covering household expenses like water and power bills at your old home. However, there are other additional costs which come with being a new homeowner. These are beyond the mortgage payment and are exclusive to homeowners.

<ol class="homeloan_Faqs_ul_1">
	<li>
	Homeowners insurance and real estate taxes: These are generally included in your monthly mortgage payments. Even if you have a fixed-interest mortgage, it can fluctuate from one year to the next because of tax changes and homeowners insurance premium changes.
	</li>
	<li>
	Homeowners association: This is something that is becoming increasingly common as people buy properties in a planned neighborhood. These can cost quite a bit per year, so it’s important to save up for it.
	</li>
	<li>
	Home upkeep and maintenance: Repairs and upgrades at your new home can get expensive. Whether you are planning to stay here forever or to sell it at a higher price after some time, you need to keep spending on maintenance till then. Homeowners should keep aside 2% of their salaries per year to meet this. If the property is older, the charges shall be more.
	</li>
</ol>

<h3 class="credit_i_h3">Plan and save for big projects</h3>

It can be tough to plan for home maintenance expenses down the line. However, for this purpose, 1% to 2% of your annual salary and/or savings shall be enough. However, do remember, the more high value the repairs and upgrades are, the more you’ll have to pay. When you do your annual expense planning, think about the home renovation projects which are upcoming.&nbsp;

<h3 class="credit_i_h3">Revisit your LIC and savings</h3>

You may have a strong emergency fund already, along with a sound LIC and retirement account all in one place. But it is useful to review these from time to time, especially after buying the new home.

<h3 class="credit_i_h3">Prioritize other forms of debt over your mortgage payments</h3>

You may possibly have bought the new home with a mortgage. If so, this mortgage is most possibly, right now, your biggest debt. However, that does not mean it is your biggest priority. Mortgage is one of those debts that is good for you. With a home loan, you get a lower interest rate, and buy a larger asset.

Before making extra mortgage payments, remove these debts if you have them.

<ol class="homeloan_Faqs_ul_1">
	<li>
	Payday loans
	</li>
	<li>
	Credit card loans
	</li>
	<li>
	Title loans
	</li>
	<li>
	High-interest personal loans
	</li>
</ol>

If you are beset with these debts, start making extra payments till all these are eliminated, your retirement savings are on track, and your emergency fund is a nice egg nest.

Consider taking side gigs to make the above possible.

&nbsp;

Buying a home could very well throw your finances off-balance. mymoneykarma guides you on how to bring your budget back on track after buying a house.

Bought A New Home? Here's How To Budget After That

For most people, buying a home is one of the biggest investments they make in their life. However, when it comes to saving up for it, most say they save “as much as possible.” However, that does not quite cut it.

Many new homeowners get unpleasantly surprised by the ancillary fees associated with a property purchase.

How much do you need to save? That depends on the cost of the house, how much of that you can afford, and a host of other factors like the type of loan you want and the area you want to live in. In this article, we’ll give you some general advice on how to get started.

<h3 class="credit_i_h3">Tackle the down payment – 3% to 20% of the cost price</h3>

Whatever you have saved, the new property’s down payment will take up a large part of it. Experts recommend that you put down at least 20% of the property’s cost price.

That being said, there are alternatives too. You can find loans that require as little as 4% down payment. However, there is a slight problem. These loans with a small down payment, you’ll still have less equity at your new home. Thus, you may still need to pay for your mortgage insurance premiums and other fees. Thus, plan ahead carefully.

<h3 class="credit_i_h3">Home inspections</h3>

&nbsp;A home inspection may seem to be something that you can easily ignore, but it is best not to. A home inspection is important because it protects you as well as your lender. It identifies faults and problems in the property before you buy it.

A home may look great from the outside. In fact, before selling, the current owners may be trying their best to renovate the visible parts, and leave out the damaged parts.

A home inspection finds out these damaged parts, and areas which need repairs. Home inspection costs can be included in your closing costs or you may need to pay these from your pocket.

<h3 class="credit_i_h3">Closing costs</h3>

Closing costs can be those miscellaneous expenses which are lumped together and payable after you have finished buying the home. These expenses include property taxes, loan fees, homeowners insurance, attorney’s fees, and title fees.

This can vary according to where you live, and on the property sale details. Generally, closing cost is between 2% to 5% of the home purchase price. However, depending on the market, the lesser can contribute to paying these as well.&nbsp;

<h3 class="credit_i_h3">Moving expenses</h3>

Moving stuff to your new home takes quite a bit of money. You can choose to take the help of your friends and even rent out a truck for the time being, but do expect then to pay its daily rate, as well as mileage.

If the new property is nearby, it may not cost you a lot. Distance matters a lot here. There are many types of movers: full service movers and limited service movers. The former may help you in packing, while the latter may not.&nbsp;

As you can see, buying your home is only just the beginning. There are other costs to take care of after that. That is why you may want to budget for monthly expenses as a new homeowner, as well as save up for renovations and improvements. Maintain an emergency fund as well in case your home needs urgent repairs.

&nbsp;

Trying to save up to buy a house? Here's mymoneykarma's guide to saving up for the purchase of a house smoothly.

How Much Money Should You Save Before Buying A House In India

There are many ways to buy a home, and several more if you want to <a href="https://www.mymoneykarma.com/buying-a-home/index.html/steps-to-scoring-mortgage.html" target="_blank">get a mortgage</a>. Now, home loans and mortgages commonly come in the form of long-term plans, such as 30-year loans. These enable you to spread your EMIs over a huge period of time, thereby decreasing the risk of spending a huge amount in a short time. However, you still need to give the EMIs, and the longer your loan term is, the more you pay in total. There are other options apart from this.

Here’s another common option: You put 10% of the home’s cost as down-payment to book the property, while the rest 90% you pay with the aid of a loan. But here’s one thing to remember: if the <a href="https://www.mymoneykarma.com/buying-a-home/index.html/arrange-down-payment-for-buying-new-home.html" target="_blank">down payment</a> is less than 20%, you need to pay private mortgage insurance in addition to the interest and principal for the loan. As you can see, this also forces you to part with a <a href="https://www.mymoneykarma.com/buying-a-home/index.html/save-money-on-home-loan-emi.html" target="_blank">larger EMI</a> at the end of each month. Larger loan amounts and their additional mortgage insurance can make your dream of owning a dream home just that, a distant dream.

<img src="https://lh3.googleusercontent.com/KsopFPMWe4ee-6kb2x6D2utyHy4r-dbwH1HaeQVnNmOt_kiEZJyn8tlhpTpbqOpy5cjEYp3Px1BgdV2LgeRSQkrpdOm3VxLOvsk-AYb2gsNEtw-teKOp_N5uV-wwRHcwujsASxcX" style="height:416px; width:624px" class="img-responsive credit_i_img">

&nbsp;But there is another choice, and this one is not as bleak as the ones before it. This is called the 80/10/10 mortgage, or the piggyback mortgage loan. This type allows you to get a home that you want and even avoid private mortgage insurance. All that by giving just 10% down payment! However, there are some small drawbacks.

However, first we shall explain how this mortgage type works, and then state the pros and cons.

<h3 class="credit_i_h3">How does it work?</h3>

Firstly, you need to choose a lender who will work with you, and who shall underwrite the loan type. Here’s when you’ll give the 10% down payment in cash in return of the first mortgage plan for 80% of the property’s purchase price, and a second mortgage loan for just 10% of the purchase price. Here’s where it gets interesting. The second mortgage “piggybacks” above the original mortgage loan.&nbsp;

This is indeed similar to the 20% down payment plan as you do not need to pay PMIs. However, the 80/10/10 mortgage is still a form of debt and you need to make installments monthly on time, and ultimately repay it. Actually, you’ll be making two monthly mortgage payments per month.&nbsp;

<h3 class="credit_i_h3">Pros of a 80/10/10 mortgage</h3>

<ul class="banklogin_ul">
	<li>
	It allows you to buy a home with fewer down payments.
	</li>
	<li>
	It enables you to avoid paying PMIs as monthly payments.
	</li>
</ul>

<h3 class="credit_i_h3">Cons of 80/10/10 mortgage</h3>

You need to repay two mortgages, which means paying two EMIs per month for the two mortgages, and that the rates can rise in the future. 80/10/10 mortgage interest rates are higher than primary mortgages. Origination fees, principal and interest all need to be paid.

These loans have adjustable interest rates, and that means these can go up. Added costs and higher interest rates can certainly pose more problems

Deciding on taking a 80/10/10 mortgage is not a light decision. You need to <a href="https://www.mymoneykarma.com/home-loan-emi-calculator.html" target="_blank">calculate the expenses</a> over time, and how it compares to other mortgage options. Also know that this option is given to borrowers selectively.

What is the 80/10/10 mortgage? Is it helpful or tricky? Or both in equal measure? mymoneykarma lays out how to effectively use the 80/10/10 mortgage.

80/10/10 Mortgage - Is an 80/20 Mortgage a Good Idea?

Looking for a loan to buy or book a new home or property? If so, you are probably asking yourself whether you should take a personal loan. The answer to that is of course yes. But there is an even more pressing question: Can you take a home loan after taking a personal loan?

The answer to that is also yes! In fact, here is good news: you can take any amount of loans as long as you can repay them simultaneously. All or most banks support this facility.

The fact is that getting a personal loan along with a home loan, which is again entirely possible, can be very helpful. Here’s why you should get the two together and what you can do with it. You can use the personal loan to pay 20% of the home loan’s down payment. Likewise, you can use the loan to renovate, buy modern furniture, upgrade your home, and of course buy the property.

Here is something you want to remember if you want to go do this dual loan path. Understand that you still need to show that you have the capacity to repay. You have to prove to the bank or to the lender that you can tackle both the loans simultaneously.

To get enough funding for both the loans, here are the four options you need to consider.

<h3 class="credit_i_h3">A healthy credit score</h3>

Banks and lenders pay special attention to this factor. You need to have a strong credit score to get the loans, and especially two credit lines at the same time. The higher your credit score is, the more you can borrow. So don’t neglect your credit score. Take your time and do all that is necessary to increase the score, unless of course you need the funds immediately. Before you apply, make sure the score is up to the mark. You may think 600 is good enough, but your lender may want 750. Get to that mark before applying, or else your credit score may suffer as a result of loan application cancellation. By the way, with a high score, you can get really low interest rates!

<h3 class="credit_i_h3">Co-apply to increase your chances</h3>

When you co-apply, you show the lender that no matter what, you will end up repaying the loan on time. Even if you cannot, your co-applicant will. This is an added security layer for the banks, and this is what makes it likely for you to get the loans.

<img src="https://lh6.googleusercontent.com/k1yDxWGeXYP7iwYro4MHHoD8CbJce5EuDQOU-9QqD5KOSe8iWyqPOVnabB8Vl357SKzRQ30cP-P0JzFPgn1PbhE5f_qczF6phbzVPFEYw31Jy2yfecjD_4PCh3vftA" style="height:416px; width:624px" class="img-responsive credit_i_img">

<h3 class="credit_i_h3">Keep debt-to-income ratio within a limit</h3>

Lenders shall see how much you earn and how much you spend on debt repayments. Based on your earnings and debt burden, you’ll get the loan.

<h3 class="credit_i_h3">Seek personal loans with flexible terms</h3>

You want to manage both the loans simultaneously. It makes a lot of difference if you get a personal loan with flexible terms.&nbsp;

To conclude, here are the things you can do to increase your chances. Additionally, you can also get your loan pre-approved.

&nbsp;

Can someone apply for a home loan over a personal loan. Home loan top-ups can function as a personal loan. Find out more at mymoneykarma.

Can I Apply For Home Loan And Personal Loan Together?

There is a big difference in taking loans from a public sector bank and from a private bank. As it is, the young generation prefers private banks like the older generations favor the public banks. Private banks make it easier for one to get a loan, and you also get an ease of approval. Private banks give you the benefit of an online application process as well.

When it comes to taking a home loan from either one of them, you need to heed factors like:

<ul class="banklogin_ul">
	<li>
	Bank processing fees
	</li>
	<li>
	Paperwork, efficiency and turnaround time
	</li>
	<li>
	Interest rate fluctuation
	</li>
	<li>
	Prepayment charges
	</li>
	<li>
	Prepayment period
	</li>
	<li>
	Pre-payment penalty amount
	</li>
	<li>
	Charges for dealing in branch office
	</li>
</ul>

Let us now see who is better in these factors: private banks or public sector banks?

<h3 class="credit_i_h3">Bank processing fees</h3>

This is charged for the analysis, paperwork and for dong the loan processing paperwork.

Private bank- They either take a lump sum amount based on the loan amount or take a percentage of the total amount. Since most private sector banks depend on direct selling agents to get customers, these fees are kept as high as 1%.

Public sector banks: These do not typically use DSAs and thus their fees are kept low from 0.25% onwards. If you want to save money, this is the better option.

<h3 class="credit_i_h3">Paperwork, efficiency and turnaround time</h3>

Private bank: They have better management and a faster processing time. This is also due to their DSAs having a strict sales target each month.&nbsp;

Public sector bank: Efficiency and turnaround time is seriously low in these banks mostly. You’ll have a slower processing time, but it shall be a steady pace.

<h3 class="credit_i_h3">Interest rates fluctuation</h3>

Private bank: Interest rates are increased as soon as the RBI decrees an increase in the REPO rate, but private banks don’t decrease interest rate with the same speed for current loan customers.

<img alt="Interest rate change is much more transparent for government banks." src="https://mmk-s3-cms.s3.us-west-2.amazonaws.com/1612865664039.jpeg" style="height:640px; width:960px" class="img-responsive credit_i_img">

Public bank: Their interest rate change is much more transparent. Their policies are for all customers and so if the rate goes down, it applies to all existing customers immediately.

<h3 class="credit_i_h3">Prepayment charges</h3>

Private bank: In their case you have to read their terms and conditions of service very carefully since you need to pay them a fee if you prepay the loan. They do this to offset the loss of interest money. Prepayment charge is mostly 2% of the remaining loan amount during prepayment.&nbsp;

Public sector banks: There are no prepayment charges here.

<h3 class="credit_i_h3">Prepayment period</h3>

Private bank: Typically, you can’t prepay before 180 days or 6 months. This is to the banks’ advantage since EMIs are placed in a way so as to give them maximum interest during the initial stages, and before you can make prepayments.&nbsp;

Public sector banks: Government banks don’t have this clause.

<h3 class="credit_i_h3">Prepayment penalty amount</h3>

Private bank: Typically, you can’t prepay more than 25% of your outstanding loans in a year.

Public sector bank: There is no such clause here.

<h3 class="credit_i_h3">Charges for dealing in branch office</h3>

Private bank: If you deal in the branch office of a private bank, you’ll be charged for all the transactions you do here. Most banks will charge Rs. 100 plus tax after a certain number of visits.

Public sector bank: There are no such policies here.

<h2 class="credit_i_h2">The Conclusion</h2>

Both Private and Public sector banks have their benefits and downsides. It all depends what you are going for.

&nbsp;

Is a private bank or public sector bank better for a Home loan? what are the merits and de-merits of both? mymoneykarma provides answers.

Buying a Home

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