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Buying a Home

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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

Imagine having taken a personal loan or home loan, only to realize a few days later that you need more money.

You fear your lender won’t give in to your wish this time unless you repay the first loan.

Thankfully, you’re in luck!

Did you know that you can take an additional personal loan on top of an existing one?&nbsp;

Yes, it is true. You can take what is known as a Top-up loan.

<h3 class="credit_i_h3">Top up loan meaning</h3>

A top up loan is an additional personal loan that you can take on top of your current ongoing loan. The catch is you can only get this when you have given a certain number of EMI payments for the existing loan.

Top-up loans are quite similar to personal loans in that they give flexibility in loan end-use. That means you can use one to fund a wedding, a dream vacation, get money during a medical emergency, renovate your home, enrol in an educational institution, and do a lot more.

The biggest benefit here is that your interest rate remains the same as the original personal loan, and that there is minimum documentation to worry about.

Now that you have seen what a Top-up loan is, let us learn about its many features.&nbsp;

<h3 class="credit_i_h3">Features of a Top-up loan</h3>

Here are some features of this type of loan:

<ol class="homeloan_Faqs_ul_1">
	<li>
	You can get it only if you have an existing personal loan: A top-up loan is not a standalone loan, meaning that you can’t take one independently. To get one, you need to have an ongoing personal loan.&nbsp;
	</li>
	<li>
	Loan amount: The maximum amount you can hope for depends on your lender. However, the amount of your top-up loan will not be more than your existing personal loan.
	</li>
	<li>
	Attractive rate of interest: You can get a top-up loan at the same interest rate as your existing personal loan. Since their interest rates vary from one customer to another, your top-up loans interest loan won’t be the same as your neighbour’s.
	</li>
	<li>
	Fast processing and disbursal: Since these are given to you if you already have a personal loan from the same lender, it follows that the lender already has most of your required documents. Your documents were already checked previously by the lender, and thus your application for a top-up loan shall be faster.
	</li>
	<li>
	Flexible repayment tenure: Depending on the tenure of your existing loan, the tenure of your top-up loan can be anywhere between 12 months to 60 months.
	</li>
	<li>
	You won’t need to give any collateral: There is no need for these things in case of a top-up loan.
	</li>
	<li>
	You benefit from flexible end use: You can use the loan for any personal need.
	</li>
</ol>

Now that we have learnt about its features, it’s time to learn about its benefits.

<h3 class="credit_i_h3">Top-up personal loan benefits</h3>

Need a reason to take a top-up loan? Well, we have way more than one! These are:&nbsp;

<ol class="homeloan_Faqs_ul_1">
	<li>
	It reduces your interest burden: If you have high-interest credit card dues, a top-up loan can help to reduce your debt burden. Thus, you get to consolidate your debt and repay with more ease.
	</li>
	<li>
	Minimal documentation: There shall be minimal documentation to worry about since your current lender already has copies of your required documents. Besides, you got the existing loan because your lender trusts you and your repayment capacity. That said, the time taken to get a top-up loan will still depend on which lender you are approaching. 
	<img alt="Documentation needed will be very less, as your current lender already has copies of your required documents." src="https://mmk-s3-cms.s3.us-west-2.amazonaws.com/1616131262595.jpeg" style="height:535px; width:960px" class="img-responsive credit_i_img">
	</li>
	<li>
	Fast processing: Since the lender already knows and trusts you, the application process is faster than when asking for a personal loan.&nbsp;
	</li>
	<li>
	Attractive interest rates: Your interest rate for a top-up loan shall be the same as your existing personal loan, and never higher than that.&nbsp;
	</li>
	<li>
	No need for collateral: Your personal loan did not require any collateral, and neither shall the top-up loan. There is no need to have a guarantor either. After all, the lender trusts you!
	</li>
	<li>
	Consolidate your EMIs: Having to pay EMIs of various loans separately costs you a lot over time. It is better to consolidate your loan and get a lower interest rate. Besides, consolidating your loans means you’ll never miss a payment!
	</li>
</ol>

<h3 class="credit_i_h3">Top-up home loan benefits</h3>

Getting a top-up home loan will provide you with several benefits, such as:&nbsp;

<ol class="homeloan_Faqs_ul_1">
	<li>
	Compared to home loans and personal loans, these come with lower interest rates.
	</li>
	<li>
	You can use this for anything between constructions to extension to renovation.
	</li>
	<li>
	You can use it for your business and personal purposes, but only if your lender agrees to it.
	</li>
	<li>
	If you use it only for home construction and renovation, you get tax benefits.
	</li>
	<li>
	There is faster loan disbursal.
	</li>
</ol>

That’s all well and good, but how do you know you are qualified?&nbsp;

Here’s how.

<h3 class="credit_i_h3">Top-up personal loan eligibility</h3>

Here’s the criteria you need to fulfil.

<ol class="homeloan_Faqs_ul_1">
	<li>
	You need to have an existing personal loan with the same lender
	</li>
	<li>
	You can take a top-up loan only after you have paid certain EMIs for your existing personal loans
	</li>
	<li>
	Your should have a spotless repayment track record
	</li>
	<li>
	You need to have a stable job or a stable source of income
	</li>
	<li>
	Your should have a high credit score
	</li>
</ol>

<h3 class="credit_i_h3">Top-up home loan eligibility</h3>

<ol class="homeloan_Faqs_ul_1">
	<li>
	You should not have bounced more than one EMI last year.
	</li>
	<li>
	In case there was a bounce, it should have been cleared before the next EMIs due date.
	</li>
	<li>
	You need to show a clear repayment of your existing loan.
	</li>
	<li>
	If you want to combine Balance Transfer with a Top-Up loan, you need to show a year’s worth of unblemished repayment history.
	</li>
	<li>
	Your age should be between 21 and 65
	</li>
	<li>
	You should be an Indian citizen
	</li>
	<li>
	One can be either salaried or self-employed
	</li>
</ol>

<h3 class="credit_i_h3">How can you apply for a Top-up Loan?</h3>

There are two ways to go about it:

<ol class="homeloan_Faqs_ul_1">
	<li>
	Visit the nearest branch of your lender
	</li>
	<li>
	Go to the lender’s website and apply online.
	</li>
</ol>

Either way, the bank shall get in touch with you in regards to your top-up loan application.

&nbsp;

Getting a top-up amount on your personal loan or home loan can be very useful. It avoids a lot of hassle to get your need met. How can this be done? Find out at mymoneykarma.

Top Up Loan Eligibility - Top Up Personal Loan - Home Loan Top Up

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

Want to know which is the most popular way to get a loan, or which is the most popular loan option? A Gold loan! It is not a modern or recent thing either. People have been taking gold loans for centuries in India. Whenever money was needed, they would take loans in lieu of their gold ornaments.

Gold loans are mostly taken to meet emergency situations, such as a medical emergency, to save one’s business, to meet a sudden demand on the market, and such. Thus, these loans are not typically taken to meet anything other than sudden needs and emergency situations. There is a good reason for this. Gold ornaments are often hereditary items, and are passed down generations in the same family. Thus, gold items and gold family heirlooms have a lot of sentimental value.

However, such views are changing. People have started taking gold loans for going on a dream vacation, to open a business, to finance a wedding, and so on. Yes, the sentimental value for gold is still there, but people are using it not just for emergency reasons any more.&nbsp;

One of the biggest benefits of gold loans is its liquidity. Depending on your requirements, you can use this loan for anything. The other big benefit is the ease of getting this type of loan. Go for any other personal loan and you’ll see how long-drawn and hard the application process can be. Not so in case gold loans. You need to submit minimal documents, and your gold items need to be of sufficient quality and quantity to get the amount you want. However, do understand that gold prices fluctuate. Thus, it’ll be better to take gold loans when gold’s market price is high. This means you may have to wait a bit before taking loans to avoid loss. 
<img src="https://lh6.googleusercontent.com/ccvRoQJUKh_k7jR9I6GdishRzoGu2dcZmyCCchS0_fB4Uxp9u9F4Vshi3dff9yNaMnM8ahQrixPdl0xAhpLZNJB7PmI_T1NKlK081QJpjFONGpK8tlD1LU5LObY8zQ" style="height:416px; width:624px" class="img-responsive credit_i_img">

Now, it may happen that you may find out your current gold loan lender’s service is not suiting you any longer. For such reasons, you want to transfer your gold loan to another lender or bank. This is what is called a Gold Loan Transfer. You basically transfer your gold loan from one lender to another.

Here is why people want gold loans balance transfers

<ul class="banklogin_ul">
	<li>
	Not being able to bear the burden of high interest rates
	</li>
	<li>
	Getting lower loan amounts that are not equal to the value of their gold
	</li>
	<li>
	Inflexible repayment options that cannot be adjusted
	</li>
	<li>
	Not being provided enough security for their gold
	</li>
</ul>

<h3 class="credit_i_h3">What are the benefits of getting a Gold Loan Balance Transfer?</h3>

<ul class="banklogin_ul">
	<li>
	Higher per gram rates: Some lenders offer more value in lieu of the gold you deposit. It pays to be with the one who gives more Loan to Value Ratio or LTV.
	</li>
	<li>
	Better interest rates: Lots of banks offer lower rates if you transfer your loan over to them. Take this advantage and you can save a lot of money on interest.
	</li>
	<li>
	Flexible repayment option: Some banks offer more and easier repayment options. Pick those that do.
	</li>
	<li>
	Better security: If a lender offers better security, you may want to make the switch.
	</li>
</ul>

&nbsp;

Gold Loan balance transfer is an altogether new development in the Gold Loan business. What are its features and benefits? Find out at mymoneykarma.

Balance Transfer For Gold Loan | Loan Against Gold | Interest Rates

How do I apply for a Home Loan? How much of a loan am I eligible for? How do I save money on my home loan EMIs? What documents will I need to get my loan approved? Why should I get personal loans online? Where can I find the cheapest interest rates? What is a loan against property?
Every day, we help tens of thousands of customers like you get clear actionable answers to questions like these. We combine a peerless experience in the Indian finance industry with strong technical expertise from Silicon Valley to bring you the insights and information you need to make great financial decisions and radically improve your personal finances.
So what would you like to learn today? Search for a specific question, browse through our selected thought pieces, or simply start at the top and work your way through our treasure trove of financial knowledge.

Learn about types of loans, eligibility, and the most frequently asked questions. Visit mymoneykarma to learn about home loans, personal loans, gold loan, and many more.

All You Need To Know About Loans: Guides, Insights, and FAQs

It hurts when your loan application is rejected. However, it hurts your credit score more than it hurts you. Getting rejected for a loan is bad for the score, not just for the short term, but for the long term as well. Getting rejected once increases your chances of getting rejected by other lenders as well. Yes, these things do get recorded in your credit report, and thus damage the score.

If your credit score is low, it can be due to a wide variety of factors. It can be due to debt settlements, on-payment of debts, not paying debt installments on time, high credit utilization, and much more. Thus, there can be many reasons for a low credit score.

The good news is that there are just as some ways to improve or increase it. But you won’t go into those points in this article. Here we shall detail out the impact of a rejected loan application on your credit score.

<h3 class="credit_i_h3">What is the credit score?</h3>

Your credit score is a 3-digit number that measures your credit worthiness, or how likely you are to repay loans. If the score goes down due to whatever reason, other lenders will see you are a risky candidate to give loans to.

<h3 class="credit_i_h3">Impact of a loan rejection on your credit score</h3>

Lenders make a credit inquiry each time you apply for a loan. This is known as a hard inquiry, which alone lowers your score if just a little bit. This is why experts warn not to apply at too many places at once for credit, as it only increases the risk of multiple rejections.

<img alt="If there is a loan rejection, ask the bank or lender why it was so." src="https://mmk-s3-cms.s3.amazonaws.com/1602767167397.jpeg" style="height:640px; width:960px" class="img-responsive credit_i_img">

Thus, be careful before applying for credit. If there is a rejection, ask the bank or lender why it was so. Ensure that you don’t make the mistake again while applying next time.

<h3 class="credit_i_h3">Reasons why your loan may have been rejected</h3>

There can be many reasons behind a loan rejection. To know the reason behind a loan rejection, and what is affecting the score, check your credit report. Here are the common reasons behind a low credit score.

<ol class="homeloan_Faqs_ul_1">
	<li>
	Taking multiple loans: Do you have more than one loan account? If so, banks are more likely to refuse you loans and even credit cards. This is because they see you as one with an unstable personal finance since you are always in need of loans.
	</li>
	<li>
	Loans defaulted: Too many of these, regardless of whether it was solely your account or whether it was a joint-loan account, you will be penalized by loan denial later on. Banks don’t want to give loans to one who has defaulted on loans.
	</li>
	<li>
	Credit score remarks: Loan defaults are not the only problem which can lower your credit score. Did you make a debt settlement with a bank? If so, then your credit report now contains the remark “settled.” This makes it hard to get loans later. However, you can still get credit if you give security. Lenders are more likely to reject unsecured loan applications at this point.
	</li>
	<li>
	Employment status: Incidents of late salary credits and when the employer is not well-known to the bank can give rise to loan rejections.
	</li>
</ol>

<h3 class="credit_i_h3">6 things to do to raise your credit score?</h3>

Here are a few things you can do to get back on track. It’ll take time, but you’ll get there.

<ol class="homeloan_Faqs_ul_1">
	<li>
	&nbsp;Pay off all debts
	</li>
	<li>
	Have a low credit utilization ratio, below 30%
	</li>
	<li>
	Pay overdue bills
	</li>
	<li>
	Do not take multiple loans
	</li>
	<li>
	Get a loan tenure which suits you
	</li>
	<li>
	Get mixed loans
	</li>
</ol>

Follow these tips, you'll get over a loan rejection.

Credit score can go down for many reasons, and loan rejection is one of them. mymoneykarma tells you what needs to be done if that is the case.

​Loan Rejections Affecting Credit Score - All You Should Know

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

Credit lines in our lives are very important. In many cases, it is essential. Credit is needed for almost anything: from buying a dream home, going on that foreign vacation you have always wanted, to give a much-desired family tour to your loved ones, to enjoy your life, to meet medical and monetary emergencies. The list goes on. There is no end to the benefits which a loan can give you. Anything expensive nowadays requires getting a loan.

<h3 class="credit_i_h3">Why is credit score important?</h3>

Just like credit is important, credit score is much more so. Credit score is a numerical representation of your previous credit behavior. It refers to how you had handled your previous loans. Did you pay on time, or were you always late?

Your credit score is given by the credit bureaus. A credit score is in the range of 300 to 900. The closer you are to 900, the better loans and credit lines you can get. A high credit score tells of your high credit worthiness, which in turn refers to lower risk for loan providers.

While you may understand how important credit score is now, perhaps some of you have a bad credit score. A bad credit score is below a certain level, due to which you may not get good loans or any loan for that matter.

If you want to buy a good product with a loan or credit, you may get disappointed and frustrated to know that lenders will not give you this.&nbsp;

However, there is good news. Credit score is not constant, and therefore can change for the better too! Your credit score is a number that changes according to your credit actions.

<h3 class="credit_i_h3">How to increase your credit score?</h3>

If some of your credit actions have resulted in the score sliding down, it can also rise up with the right credit actions. All you need is responsible and right behavior. Soon you will see your score going up again. Here are some of the most common things you can do to improve your credit score again.

<ol class="homeloan_Faqs_ul_1">
	<li>
	Be regular with your existing loan and credit products
	</li>
	<li>
	Repay outstanding loan balances
	</li>
	<li>
	Focus on keeping credit utilization ratio low
	</li>
	<li>
	Get a fair mix or secured and unsecured loans
	</li>
	<li>
	Do not suddenly close off your old credit accounts
	</li>
	<li>
	Limit credit applications&nbsp;
	</li>
</ol>

As you can see, most of the options given above work for those who are pre-approved for credit products already. However, what about those who still find it hard to get any credit or new loans approved due to existing low credit scores? How can they get their scores up?

In this article, there are answers for that as well. Mymoneykarma is here to guide you to achieving the perfect credit score. Here is one good option for those with low credit scores, and who wish to build up the score: credit builder loan.

<h2 class="credit_i_h2">What is a credit builder loan?</h2>

A credit builder loan is one which is especially designed to cater to the needs of those seeking to improve their low credit scores, and for those who are new to credit.

<h3 class="credit_i_h3">How do Credit Builder Loans work?</h3>

Someone who has no or low credit score finds it hard to get any kind of loan. When they ask for loans, lenders tell them to get a good credit score first. However, the only way to get a higher score is by getting loans in the first place. So this vicious cycle just goes on and on. Fortunately, we have credit builder loans.

While there are other options like fixed deposits and secured credit cards, credit builder loans are the best, since in case of the other options a person may not have any securities to deposit for getting loans. In such situations, a credit builder loan is very useful. Even a <a href="https://www.mymoneykarma.com/gold-loan.html" target="_blank">Gold Loan</a> can be used as credit builder loans.

The main idea behind this financial instrument is to lend out small amounts that people can pay back easily in a short time, and therefore increase creditworthiness.

Credit builder loans are designed by and are available at many banks and other financial institutions. Here is how to get these.

<ol class="homeloan_Faqs_ul_1">
	<li>
	Approach a credit lender who offers these
	</li>
	<li>
	Since you do not have an existing credit profile, or a bad one, the lender will see other points like social media profile and bank transactions to build up your credit profile, to help them making a decision to lend
	</li>
	<li>
	At times, banks may insist on lending just to those who have a account with them to reduce their own risk
	</li>
	<li>
	These loans are similar to personal loans, but the amount can be available since the loan is very small
	</li>
	<li>
	The tenure is shorter than normal personal loans, and ranges from 6 months to 1 year
	</li>
	<li>
	Once the bank disburses the loan, you have to start making regular EMIs
	</li>
	<li>
	When you pay regular EMIs, credit bureaus notice that and make improvements on your credit score
	</li>
</ol>

<h3 class="credit_i_h3">What are the many types of credit builder loans?</h3>

There are several types of credit builder loans available among the various lenders. Single lenders may not be able to provide all of these, though.

<ol class="homeloan_Faqs_ul_1">
	<li>
	Pure credit builder loan: In this type, your loan is kept away in a locked savings account. You don’t have access to it yet. However, after you have repaid that loan with EMIs, the whole amount with interest is given back to the lender. Lenders may also charge a small fee.
	</li>
	<li>
	Secured credit builder loan: In this, the amount of your savings account is used as loan security. Till you pay the loan, you can’t access it. While the interest rate is lower, the savings account can’t be used until you repay the loan.
	</li>
	<li>
	Unsecured credit builder loan: This is the type that is commonly available. The loan amount is given and the borrower makes repayment as per schedule. However, it has a higher interest rate.
	</li>
</ol>

A credit loan builder is there for helping you increase your credit score. But at the same time, don’t forget that you still need to be responsible towards new credit after repayment of this loan, or your credit score will go down again.

&nbsp;

How does a credit builder loan work. How effective are they in improving your credit score? Get your questions answered at mymoneykarma.

What Is A Credit Builder Loan? | Types Of Credit Builder Loans

It may not be easy anymore to get a loan. Lenders are becoming stricter, especially due to the current economic conditions. And yet, people’s difficulties and therefore their desire for loans are increasing.

One may need a loan for just about anything. It can be for children’s education, debt consolidation, marriage, car purchase, property purchase, equipment purchase, and more. It can be anything, and yet the fact remains that there is a great demand for loan right now. You may need money urgently, but lenders may not want to give you anything, for any reason.

To increase your chances of getting loans, here are a few tips:

<ol class="homeloan_Faqs_ul_1">
	<li>
	Check the loan eligibility before applying: Here’s a big mistake many people make. They don’t see the lender’s eligibility criteria and apply for the loan. Some understand that they are not eligible, but apply anyway just to get a chance, which never comes by the way. It is simple. If you do not meet the criteria, you don’t get the money. Worse, it can harm your credit score too due to a loan enquiry and denial.
	</li>
	<li>
	Check your credit score before applying: Lenders want your credit score beyond a certain level, without which your loan application stands to be denied. Your credit score is a measure of your credit worthiness and how trustworthy you are in repaying credit. Your credit is important as it is based on previous loans, income, assets, repayment behaviors, and more. The score needs to be at least 700 to be considered.
	</li>
	<li>
	Don’t apply for too many loans at once: This is another big mistake people make in their desperation to get emergency money. They apply at too many places at the same time. This, however, lowers your credit score, and banks can even deny you loans if they come to know you are asking at multiple places. 
	<img alt="Don't apply for loans at too many places at the same time." src="https://mmk-s3-cms.s3.amazonaws.com/1602766656597.jpeg" style="height:640px; width:960px" class="img-responsive credit_i_img"> 
	Multiple applications mean multiple rejections, since it signifies lack of ability to repay the loan and lack of confidence. The best thing to do is to research about a few lenders and pick the one who suits you most.
	</li>
	<li>
	Correct errors in your credit report: You can see your credit report free once a year, and the cost afterwards is negligible. Studying the report will let you come across any mistakes. Mistakes and misstatements affect your credit score, and therefore many things in your life. Therefore, take your time to study the report. If you find mistakes, inform the concerned credit bureau. It’ll correct your report.
	</li>
	<li>
	In case of rejection, don’t apply before 6 months: This is a common mistake as well. Right after a loan application rejection, people apply for another. The problem? It lowers your credit score, which in turn makes it harder for you to get credit later on.
	</li>
</ol>

Use these tips before applying or a loan or even a credit card.

Getting a loan can be hard nowadays. Here are 5 tips to keep in mind before applying for a personal loan.

Top 5 Tips To Get Your Personal Loan Approved At Indian Banks

Let me tell you the story of Sam.

A 25-year-old IT professional, Sam was crazy about cars. His walls were hidden under posters of cool sports cars. Innumerable copies of Autocar, Overdrive, and TopGear cluttered his study table and bookshelf.

During his teenage years, Sam almost spooked out his neighbor by gaping hungrily at his brand new Mercedes. Sam had one dream since childhood - to buy a Porsche. Yes, it was too ambitious a dream.

Although the Porsche purchase didn't happen, Sam bought himself a Honda City within a year of getting a job. It was extremely irrational and a childish mistake. Well, an <a href="https://www.mymoneykarma.com/auto-and-car-loan-emi-calculator-in-india.html">auto loan</a> made this happen. Soon enough, Sam was struggling to make ends meet.

He was clearly not making enough money to afford his lavish lifestyle while repaying the hefty auto loan EMIs. After a brief stint of frustration, Sam pulled his socks up and decided to sell the car. However, the car was <a href="https://www.mymoneykarma.com/loans/repossession-effect-on-credit.html" target="_blank">hypothecated in lieu of the loan</a>, and it wasn't easy to sell the car off.

After days of thorough research, Sam discovered a way out of this mess - transferring his car loan to somebody else!

Are you, like Sam, financially crushed by an auto loan and want to get it off your hands?

<h2 class="credit_i_h2">Steps to Transfer a Car Loan</h2>

Transferring an auto loan wasn't allowed earlier, but there are two different ways to do it now. One way is to modify your existing lender - notify your lender that someone else will be purchasing your car and <a href="https://www.mymoneykarma.com/loans/tips-to-pay-off-car-loan-faster.html" target="_blank">repaying the rest of the loan</a>.

The other way is to do a <a href="https://www.mymoneykarma.com/credit-scores/index.html/how-refinancing-affect-credit-score.html" target="_blank">balance transfer</a> and seek a new lender who will <a href="https://www.mymoneykarma.com/buying-a-home/index.html/index.html/how-to-reduce-debt.html" target="_blank">pay off the remaining debt</a> and issue a new loan to the new borrower. Let me tell you the various steps involved in transferring an auto loan to someone else.

<h3 class="credit_i_h3">Check Your Auto Loan Documents</h3>

Before you feel too elated by the prospect of unburdening yourself of this financial anxiety, read and re-read your auto loan agreement. The first thing that you need to make sure is that your lender allows a car loan transfer.

Reading a loan agreement can be quite a chore. Be patient! If your loan agreement papers say that transfer is not allowed, then you're barking up the wrong tree. Sorry!

If you're sure that the plan is actionable, seek the lender's help to get clarity on the loan transfer process.

<h3 class="credit_i_h3">Find A New Borrower</h3>

Since you have already decided to transfer your loan to someone else, I am assuming that you need to find a buyer. If you have already found one, you're in a win-win situation! If you are still struggling to find a new buyer/borrower, cheer up! A car dealer can find one for you.

Just approach some recognized and trustworthy second-hand car dealer, and they will find you an interested buyer from their long list of contacts.

<h3 class="credit_i_h3">Get Loan Transfer Approval</h3>

First things first - get the green signal from the lender. The new borrower must prove his creditworthiness in order to qualify for the car loan transfer. He/she should have a stable income and a clean track record of <a href="https://www.mymoneykarma.com/credit-scores/index.html/how-late-payments-impact-credit-score.html" target="_blank">credit repayment</a> with banks. The new borrower will now be responsible for repaying the loan.

So, isn't it obvious that the lender will conduct a thorough background check before deeming him/her fit for the loan and approving the loan transfer?

A single default in the prospective borrower's past can adversely affect his/her credibility and might compel the lender to disallow the transfer of your auto loan to the concerned person. If you have found someone with a stellar <a href="https://www.mymoneykarma.com/credit-scores/index.html/reasons-why-monitor-credit-report.html" target="_blank">credit history</a>, then you are in luck! You can approach your lender to initiate the formalities related to auto loan transfer.

The new borrower must submit a few necessary documents like proofs of identity, address and income. Additionally, a form requesting the transfer of the auto loan should also be submitted by the new borrower.<img alt="How to Transfer Your Car Loan to Another Person" src="../../images/new/personal-finance/how-to-transfer-your-car-loan-to-another-person.jpg" class="img-responsive credit_i_img">

<h3 class="credit_i_h3">Change the Car Registration</h3>

When you are planning on selling your car, you need to change the car registration too. It is not just a fleeting formality but a necessary prerequisite to transferring the loan documents. You need to visit the nearest <a href="https://www.mymoneykarma.com/driving-licence/rto-offices-in-india.html">RTO</a> (Regional Transport Office) for completing this formality.

Once you submit the required documents and pay the necessary charges to initiate the re-registration procedure, the RTO will take around 14 days to process the request.

<h3 class="credit_i_h3">Approach Your Insurer</h3>

When you sell your car, you wouldn't want to bear any further liabilities associated with the car. This involves your car insurance expenses too. Approach your current vehicle insurance company to check the terms and conditions for transferring your car to another individual. You must ensure that the new owner, who is taking over your loan, complies with the <a href="https://www.mymoneykarma.com/insurance/index.html/" target="_blank">insurance requirements</a>.

Submit all the necessary bank documents to the insurance company to let them make the necessary changes so that you are exempted from paying any additional premium.

<h2 class="credit_i_h2">Remember...</h2>

You should know that it'll be futile to visit the RTO or your vehicle insurer before the lender gives you a formal approval for your loan transfer request. Unless you furnish the necessary documents from the lender, neither the RTO nor the insurer will entertain your requests.

Once you get through all the above-mentioned procedures smoothly, you can go back to the lender, submit all the necessary documents and get the burdensome loan off your shoulder. However, brace yourself to pay a certain loan processing or loan transfer fee to the lender. The charge is mostly based on the tenure of the loan, and the amount that is left to be paid.

However, rest assured that spending a few bucks here can leave your bank balance at peace once the transfer is successful.

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

Although the modern world has a solution to almost every problem, it isn't wise to get yourself into one. Sam got his problem sorted, sold off the car and restored his peace of mind. But what if his auto loan was not transferable? Tell me honestly - would you care to check this before taking a loan?

Therefore, be vigilant while taking out a loan - be thorough with the terms of the loan, check the car loan interest rate, use a car loan EMI calculator to know what kind of monthly expenses you're looking at and realistically consider your ability to repay it. When it comes to that, <a href="https://www.mymoneykarma.com/credit-score/credit-score.html?utmsrc=loans_1287" target="_blank">check your credit standing</a> as well.&nbsp;After all, prevention is better than cure.

If not a car loan, you could also go for a presonal to finance your vehicle purchase. Need it?&nbsp;<a href="https://www.mymoneykarma.com/credit-score/personal-loan-credit-score.html?utmsrc=personalloan_enquiry" target="_blank">Apply right away</a> through mymoneykarma.

How to transfer your car loan to someone else? Its tricky, but its doable. Read on to know the procedure for the same from the experts at mymoneykarma.

How to Transfer Your Car Loan to Another Person - Car Loan Transfer

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

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

Want to know everything about your credit score? Want to know how to make it work for you? Read this ultimate guide from mymoneykarma to find out.

The Ultimate Guide to Credit Score in 2021 | Free Credit Score

Right now, it is a very tough time for those looking for personal loans. While not impossible, getting a personal loan now is an uphill battle. Personal loan applications which have a high interest rate and need no collateral, and which are sanctioned mainly on the basis of the credit history profile of the borrower, are being denied or turned down.

Other loan products such as home loans have the same story. Try asking for a home loan now. Chances are getting one will be tough.

However, all this does not mean that you won’t get any form of loans.

<a href="https://www.mymoneykarma.com/gold-loan.html" target="_blank">Gold loans</a> are doing quite well right now. Gold loan as a product is seeing its resurgence during this pandemic when all other forms of loans and lines of credit are not performing as before. During this time, the demand for gold loans has increased manifold. Another good news is that their interest rates are notably lower than other personal loans.&nbsp;

However, many people are still reluctant to give their gold to get a loan. In this article, we are going to tell you why despite RBI’s push, banks are still quite reluctant in lending out money, and what you can do to avoid a lender’s rejections.

<h2 class="credit_i_h2">Why are banks turning down loan applications?</h2>

<h3 class="credit_i_h3">Norms are more stringent now</h3>

From the beginning of this year, the RBI cut the repo rate several times. After such actions from the RBI, banks are now much more cautious of discounting higher NPAs. 
 
Generally, loans are sanctioned based on income, age, secondary income sources, credit score and even location of employment. However, in this economic situation, banks have a higher level of scrutiny when choosing borrowers. There are now more stringent policies on income sources and repayment capacity. Right now, banks can’t afford bad loans and non-repayments. The same is true even in case of loans where there is collateral. Instead, banks are preferring employees of large companies, in the light of which self-employed individuals are finding it hard to get loans. 
 
Even if you get the loan with security, the Loan to Value ratio will be moderate. 
&nbsp;

If you are a new borrower who has no credit history, you can bet your application will be rejected. After all, banks cannot yet trust your capacity to repay. Others who’ll suffer in this situation are those from industries like aviation, tourism and hospitality, and those who availed the <a href="https://www.mymoneykarma.com/trending-in-finance/index.html/moratorium-period.html" target="_blank">RBI’s moratorium</a>. 
&nbsp;

<h3 class="credit_i_h3">How to avoid loan application rejection</h3>

1. Pre-pay current loans ending in a few months: Banks are now more cautious, as we have seen. Under these circumstances, the best thing you can do is to pre-pay the last EMIs of current loans. Banks are now paying more heed to the FOIR parameter, or fixed obligation to income ratio. This means those loans which are about to close soon. 
 
2. Importance of keeping an eye on your credit score and credit utilization rate: As before taking any loan, you need to keep your eyes more on these parameters now. You need a <a href="https://www.mymoneykarma.com/loans/loan-against-gold-influence-credit-score.html" target="_blank">credit score</a> of 700 and above if it’s a private bank. Your credit utilization rate needs to be around 30%. These shall help in clearing away all your credit card obligations. 
 
3. Consider step-up loan: If you have just started your career, you know that down the line your income will increase, just like your EMI installment against the loan over a fixed tenure. This is what happens in case of a step-up loan. 
 
4. Take a joint loan to increase loan eligibility: If the second applicant is a working professional, you have more chances of getting accepted. 
 
5. Don’t apply for loans at too many lenders: Try secured loans like home loans instead. These have tie ups with mortgage guarantee companies. Applying at too many lenders makes your credit score go down.&nbsp;

If you use these 5 tips, you have more chances of getting your loan application accepted.

&nbsp;

Getting a loan approved is hard in these uncertain times. mymoneykarma is here to help with 5 ways in which you can assure your loan approval.

5 Tips To Get Loan Approved Faster | How To Avoid Loan Rejection

Buying a dream car is usually on the bucket list of many people; likewise, it was on mine too. However, buying a car without an auto loan is very unlikely, especially for salaried individuals. There are various points you need to keep in mind for taking a car loan and then being able to repay it faster without having to pay a tremendous amount of interest.

I am going to share my experience with you, but before that, let's discuss the steps to go through before opting for a car loan. 
 
1. Down-payment and EMI calculation: Ensure that you have the right budget to make a down payment to the maximum extent, so that the pressure of EMI and tenure of the loan get reduced. Reduction of EMIs will substantially cut down the interest on the loan.

Banks may tempt you by offering to lend 100% of the on-road price of the car. However, if you have enough monetary resources, you can take a lesser amount of loan to buy the car. Also, calculate the EMIs on mymoneykarma <a href="https://www.mymoneykarma.com/auto-and-car-loan-emi-calculator-in-india.html" target="_blank">auto loan calculator</a> to determine what you can afford before choosing the loan. 
 
2. The rate of Interest: The interest rate of car loans usually ranges between 9.5%-13.5% per annum on new cars, and it goes up to 15%-20% on used cars. Many banks adopt the practice of keeping the interest rate fixed for the entire loan term.

However, it is always advisable to choose a floating rate of interest as it gives the benefit of a lesser interest rate instantly whenever the rates are slashed. 
 
3. Processing fee, foreclosure charges &amp; the late payment fee: Choose the bank that has less processing fee, foreclosure charges, and <a href="https://www.mymoneykarma.com/credit-scores/index.html/how-late-payments-impact-credit-score.html" target="_blank">late payment</a> fee to reduce the overall cost of the car loan. 
&nbsp;

<h2 class="credit_i_h2">How Can You Repay Car Loan Faster?</h2>

1. Make an additional payment: 
If your budget allows, then increase the regular EMI payment. For example, if your EMI payment comes to be Rs. 12,000, you can then start paying Rs.13,000 without putting much burden on your pocket.

In this way, you will be paying an additional annual payment of Rs 12,000 towards the EMI, therefore cutting down your loan term and the interest outgo. 
 
2. Part-payment of loan: 
You can partly pay the mortgage from hikes in your salary or investment yield or annual bonus. It not only reduces the loan amount but also saves much interest that you might have to pay otherwise. Many banks and NBFCs offer this option. The more you stretch the loan repayment timeline, the more interest you pay. If you pay back a lump sum, the outstanding principal gets reduced and helps you save considerably on the interest.

However, before availing such an opportunity, confirm from the lender if there is any penalty for part payment. If there is a penalty, then find out the exact amount. Deduct the penalty amount from the savings that you would make on interest if you prepay a lump sum. Now, check the resultant savings after deducting the penalty fees. If the savings turn out to be ample, it's worth making a part payment. 
 
3. Never skip the EMIs: 
Some lenders may allow you to skip the payment once or even twice a year. However, try to resist such temptations, as skipping payments will lengthen the term of your loan and cost you more in interest.

In case you are jumping the payments on your own, remember that it will affect your credit score and your credit account can be declared as <a href="https://www.mymoneykarma.com/credit-scores/index.html/remove-negative-credit-report.html" target="_blank">delinquent</a> by the bank, which may reflect on your credit report for a long time.

4. Increase the EMI amounts over time:

There is an annual appraisal benefit provided by most of the companies, which results in a salary hike. At this time, you should be paying more amount towards EMIs. If you continue doing this each year, it will drastically reduce the&nbsp;loan tenure. Also, as you are paying more than the actual EMIs, the outstanding of the loan will be reduced.

5. Round up the payments and pay:

Instead of just paying what is mandatory, round up the amounts to the nearest number to repay your car loan more quickly. For example, if you are paying Rs. 10,200 for EMI, make it Rs. 11,000 as it assists in repaying the loan faster. 
 
6. Choose the car as per&nbsp;affordability: 
Assess your financial limit and purchase power before choosing a car model. For example, if your budget can afford a Ford Figo, you must buy it instead of purchasing a BMW, which is beyond your reach. 
 
7. Keep a lid on the expenses: 
Make effective financial plans by keeping expenses such as rent, <a href="https://www.mymoneykarma.com/travel-lifestyle/index.htmlindex.html/tips-to-save-electricity-bill.html" target="_blank">electricity</a>, food and some other miscellaneous expenditures in mind. Always make sure to keep your income level much ahead of the expenses, so that you can pay off the car loan much faster. 
 
8. Don't take a new loan: 
If you already have a <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">home loan</a>, then don't take an auto loan and put an additional burden on your pocket. You might not be able to afford it. 
Taking out a new loan can leave an impact on your future credit by messing up your credit score. I had a credit score of 810 when I was approved for the loan. After two months of timely payments, I checked my credit score and discovered that it had dropped down by 15 points.

I had not missed any payments, nor had I accumulated a debt on my credit cards -&nbsp;so, the drop was entirely due to the new loan that I had taken. I realized that a 15-point slump isn't a problem if the credit score falls within the range of 700-800.

However, if the <a href="https://www.mymoneykarma.com/credit-scores/index.html/reasons-for-credit-score-drop.html" target="_blank">score drops</a> to the 600 range, then 15 points can be the difference between loan approval and rejection.

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

It's not difficult to accomplish dreams nowadays, but doing it with intelligent planning is essential. If you go beyond your income level, then it will not be healthy for your financial life in the long run.

For best results, <a href="https://www.mymoneykarma.com/credit-score/credit-score.html?utmsrc=carloan" target="_blank">check your credit score</a> regularly as well.

Here, mymoneykarma will suggest that you must <a href="https://www.mymoneykarma.com/personal-finance/i/do-it-yourself-budgeting.html">prepare your budget</a> wisely before taking any credit so that the spirit of accomplishment doesn't put you under massive debts. 
&nbsp;

Wondering how to pay off your car loan faster? Here are a few smart tips and tricks to help you settle your car loan debt quickly.

How to Pay Off Your Car Loan Faster | Car Loan Tips | 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

Credit or loans are financial instruments which are given to you by lenders with a trust that you’ll pay the bank on time. A credit score reflects how you handle your loans and credit lines responsibly. So, the answer to your question would be yes, gold loans do influence your credit score.

On the other end of the spectrum, if you neglect payments, you’ll only hurt your credit score, which can take a lot of time to repair again. If you want to get access to loans at all times, it is important to handle credit carefully. To do that, you need to know about the different ways in which a gold loan can help increase your credit score.

To help you understand this subject better, here are a few points.

<ol class="homeloan_Faqs_ul_1">
	<li>
	Gold loan applications: Bet you didn't know that applying for gold loans impact your credit score? That’s right! Just by applying for a gold loan (and it’s not Loan for Gold, by the way), can reduce your score by a few points. But how? This happens because each time you apply for a gold loan; a hard inquiry is initiated by lenders. Hard inquiry is when lenders tell credit bureaus to assess your credit report. They determine whether your application will be approved, or not. Such hard inquiries reflect on your credit report, and therefore on your credit score. If you apply to too many gold loans in a short time, it’ll show that you are loan-hungry, or spend a lot. You won’t be getting any new loans that way. You can avoid this by <a href="https://www.mymoneykarma.com/gold-loan.html" target="_blank">applying for a gold loan</a> through mymoneykarma! With a single, quick application, we find you the best Gold Loan deal from across national-level lenders.
	</li>
	<li>
	Gold loan payments: If lenders do accept your application, you will have to repay as per their terms and conditions. If you meet these, your credit score will be boosted. This is really helpful, as repayment is made very easy for gold loans, due to flexible repayment schemes and low interest rates.
	</li>
</ol>

<h3 class="credit_i_h3">How do gold loan payments affect your credit score?</h3>

It is important to make payments before or on time, if you want to make a good credit score over time. When you pay EMIs regularly on time, it tells you are responsible and credit worthy. It makes you more attractive to a borrower because they know you’ll always pay back on time. Lenders always give more preference to such customers. They can even lower the interest rates a bit for you!

<h3 class="credit_i_h3">Loan default</h3>

A default happens when you do not meet the gold loan repayment obligations according to the lender’s contract. Even if the delay is that of one day, the credit bureaus get to know about it from your lender. And that lowers your credit score substantially. In addition, you also attract charges for paying EMIs late. If you continue to pay EMIs late, you’ll get a legal notice from them, which can enable the bank to possess your gold article.&nbsp;

<h3 class="credit_i_h3">In conclusion</h3>

You know by now how a <a href="https://www.mymoneykarma.com/gold-loan.html" target="_blank">gold loan</a> can influence your credit score. Multiple applications lower the score, and making regular EMI payments boost it. Don’t miss the payment date. Set a reminder if you have to. Your credit score depends on it.

&nbsp;

Can a Gold loan impact your Credit Score positively? mymoneykarma examines the popular idea of Gold Loans as credit builder loans.

How Does A Loan Against Gold Influence Your Credit Score?

Remember how you felt when you dreamt of buying your first bike as a teenager? The sense of all that freedom and excitement? It seemed as if the world had opened up to you, and that getting a bike was an initiation for stepping into adulthood. Besides, bikes are cool!

Well, adults pretty much get the same feeling when they buy their first car.&nbsp;

However when it comes to buying a car, very few can buy it with cash just out of their wallet. Most people have to take out a car loan for that.&nbsp;

In this article, we are going to tell you about the Do’s and Don’ts for applying for a Car Loan.

<h3 class="credit_i_h3">Select the right car</h3>

Before going to the showroom and buying the first shiny car you spot, you need to figure out what type of car you need? If you go on frequent trips with your family, an SUV can be the perfect choice due to its huge space. However, you’ll find it hard to park in the city. If it is for special occasions, you may want to buy more luxurious models. If you want more heavy-duty protection, try a Scorpio or even an imported Hummer!

<h3 class="credit_i_h3">Don’t make a mistake in calculating how much you can afford</h3>

This is one of the biggest mistakes you can make. This is one of the most surefire ways of falling in a debt spiral. When taking a loan, a lower down payment translates to a lot of money to be repaid back as loan amount.

<img src="https://lh6.googleusercontent.com/OHr9U98kiTf0B4eTw1AjZTNdPJ5WJaVunVbvg5N6j15BKfPDUhKFQs9MkyleSLk-8V4BrRug3hSjhEIUk3Pv-fyuzzpvOvaqAsqX9usk6G1vi0DqXMw_HPHA5JQtxw" style="height:416px; width:624px" class="img-responsive credit_i_img">

If you have loans already, rethink about taking yet another one. Sure you may think you can afford this loan too, but together with all your existing ones? That can be a problem. Additionally, ensure that your EMIs across all your loans are less than ½ your monthly income.

<h3 class="credit_i_h3">Think about your credit score</h3>

When taking a loan, you do need to think about keeping a good credit score. The higher your credit score, the lower your loan interest rate can potentially be. The lower the score is, the higher it can potentially be. In fact, if your credit score is too low, you may not get any loan at all, and even if you do, it will be on very steep and unfavorable terms.&nbsp;

<h3 class="credit_i_h3">Don’t choose the very first financing offer you get</h3>

Your very first financing offer may be from the car dealership itself if you have tie-ups with financing companies. However, what you should be doing is browsing through multiple financing deals before picking one. Of course, then you can pick the one that suits you the best.

As you can see, there are certain things which you should be doing and should not be doing when getting a car loan. Here’s hoping you get the loan, and safe driving!

&nbsp;

When applying for a car loan, what should you avoid doing, and what are things that should be done? Find out the answers at mymoneykarma.

Applying for a Car Loan in 2021 - The Do's and Don'ts of a Car Loan

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

To make the right choice when choosing personal loans, you need to compare interest rates, fees and charges, and repayment flexibility.&nbsp;

mymoneykarma has made this easier for you by bringing all that information in one place for easy comparison.

<h3 class="credit_i_h3">Compare these Criteria of Different Major Banks</h3>

<table class="table table-bordered credit_i_table">
	<tbody>
		<tr>
			<td>
			Bank
			</td>
			<td>
			Interest Rate
			</td>
			<td>
			Processing fee
			</td>
			<td>
			Foreclosure Charges
			</td>
		</tr>
		<tr>
			<td>
			<a href="https://www.mymoneykarma.com/hdfc-bank/index.html">HDFC Bank</a>
			</td>
			<td>
			10.75% onwards
			</td>
			<td>
			Till 2.5% of the total loan amount, upto a minimum of Rs. 2,999 and to a maximum of Rs. 25,000.
			</td>
			<td>
			Up to 4%
			</td>
		</tr>
		<tr>
			<td>
			Standard Chartered Bank
			</td>
			<td>
			11% onwards
			</td>
			<td>
			Up to 3%
			</td>
			<td>
			2% - 5%
			</td>
		</tr>
		<tr>
			<td>
			Kotak Mahindra Bank
			</td>
			<td>
			10.99%
			</td>
			<td>
			Up to 2.5%
			</td>
			<td>
			5%
			</td>
		</tr>
		<tr>
			<td>
			ICICI Bank
			</td>
			<td>
			11.25%
			</td>
			<td>
			Up to 2.25%
			</td>
			<td>
			5%
			</td>
		</tr>
		<tr>
			<td>
			Yes Bank
			</td>
			<td>
			10.99%
			</td>
			<td>
			Up to 2.50%
			</td>
			<td>
			4%
			</td>
		</tr>
		<tr>
			<td>
			State Bank of India
			</td>
			<td>
			10.50%
			</td>
			<td>
			1%
			</td>
			<td>
			3%
			</td>
		</tr>
	</tbody>
</table>

<h3 class="credit_i_h3">How to get Personal Loans</h3>

Getting loans from banks is not like borrowing from your parents. 
Your parents probably won’t pay much attention if you later can’t repay them back. But banks will. They also have a more stringent eligibility check.

<img alt="how to avoid rejection of personal loan : eligibility criteria" src="https://mmk-s3-cms.s3.us-west-2.amazonaws.com/1587983806926.jpeg" style="height:640px; width:960px" class="img-responsive credit_i_img">

These checks are for determining whether you are at all capable of repaying the loan. Here are the criteria on which your getting the loan will depend. 
 
Personal Loan Eligibility

<table class="table table-bordered credit_i_table">
	<tbody>
		<tr>
			<td>
			Criteria
			</td>
			<td>
			Salaried
			</td>
			<td>
			Self-employed
			</td>
		</tr>
		<tr>
			<td>
			Age
			</td>
			<td>
			21 to 60
			</td>
			<td>
			22 to 55
			</td>
		</tr>
		<tr>
			<td>
			Credit Score
			</td>
			<td>
			More than 750
			</td>
			<td>
			More than 750
			</td>
		</tr>
		<tr>
			<td>
			Net Monthly Income
			</td>
			<td>
			Rs. 15,000
			</td>
			<td>
			Rs. 25,000
			</td>
		</tr>
		<tr>
			<td>
			Minimum Loan Amount&nbsp;
			</td>
			<td>
			Rs. 50, 000
			</td>
			<td>
			Rs. 50, 000
			</td>
		</tr>
		<tr>
			<td>
			Maximum Loan Amount
			</td>
			<td>
			Rs. 25 lakhs
			</td>
			<td>
			Rs. 30 lakhs
			</td>
		</tr>
	</tbody>
</table>

 
But passing eligibility criteria is not the only determining factor. You need to submit some documents too. 
 
Documents You Need to Submit for Personal Loan

<table class="table table-bordered credit_i_table">
	<tbody>
		<tr>
			<td>
			Requirements
			</td>
			<td>
			Salaried Individuals
			</td>
			<td>
			Self-Employed
			</td>
		</tr>
		<tr>
			<td>
			ID Proof
			</td>
			<td>
			Aadhar card, Passport, Driving License or the PAN Card
			</td>
			<td>
			Aadhar card, Passport, Driving License or the PAN Card
			</td>
		</tr>
		<tr>
			<td>
			Residence Proof
			</td>
			<td>
			Utility bills or passport
			</td>
			<td>
			Utility bills or passport
			</td>
		</tr>
		<tr>
			<td>
			Income Proof
			</td>
			<td>
			Bank statement of applicant’s salary account for the previous 2 years
			</td>
			<td>
			Bank statement of applicant’s salary account for the previous 2 years
			</td>
		</tr>
	</tbody>
</table>

<h3 class="credit_i_h3">But I’m a NRI! Can’t I get a loan here in India?</h3>

Sure you can! However, you need to submit different documents. They are:&nbsp;

<ul class="banklogin_ul">
	<li>
	Copy of your Visa
	</li>
	<li>
	Copy of your passport
	</li>
	<li>
	The email ID of your HR or your own official email ID
	</li>
	<li>
	Salary slips
	</li>
	<li>
	Bank statements
	</li>
	<li>
	Proofs of residence, identity, assets and income
	</li>
	<li>
	Recently-taken passport-size photos of your guarantors and you
	</li>
	<li>
	NRE/NRO bank statements of the last 6 months
	</li>
</ul>

We hope that this information will be helpful to you. After all, its easier when everything is in the same place! Next up, we’ll be discussing the Top Benefits of Personal Loans.

&nbsp;

Personal loan eligibility is important to know before you apply for a personal loan. mymoneykarma helps you learn all about personal loan eligibility, and offers easy online application as well.

Check And Compare For Personal Loan Eligibility In 2021

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

Lenders give you money after determining your credit worthiness, which means how likely you are to give back their loan on time.

Think of it from a different perspective of the lender. He is actually taking a risk by lending money to anyone at interest. After all, the borrower may not give back the money due to various reasons. This is why lenders, whether they are banks or individual lenders, give money after scrutinizing your credit worthiness. Understand, giving personal loans is risky.

They do this by seeing your credit score. A low credit score can indicate that you are not very credit-worthy, while a high score indicates otherwise. If you have a high credit score, banks will line up to give you loans.

Now, you may have heard that you can’t get loans with a bad credit score. However, it is not completely true. Here are ways to get a loan despite having a low credit score.

<ol class="homeloan_Faqs_ul_1">
	<li>
	Prove that your income can support EMI payments: Lenders are mainly interested in getting their money back on time. So if you have a stable monthly income which can support the monthly EMIs, they may not mind you having a low credit score. Yes, maybe you’ll get it at a high interest rate, but at least you’ll get the money.
	</li>
	<li>
	As for a lower amount: A lower amount mitigates the risk of the lender, even if slightly. So if banks are not ready to give you a large amount, ask for a small amount. They shall be more than likely to give you that. Giving a smaller amount makes banks more comfortable in dealing with you since smaller amounts are easier to repay.
	</li>
	<li>
	Apply along with a co-applicant or guarantor: So here’s the thing with co-applicants and guarantors. Their creditworthiness is more than yours, and if they co-apply or guarantee loan repayment, banks will be more willing to give the money. Since guarantors and co-applicants greatly increase the chances of repayment, you are more likely to get the loan. 
	<img alt="Credit bureaus handle hundreds and thousands of credit reports a year, and this there can be errors easily." src="https://mmk-s3-cms.s3.amazonaws.com/1602766553833.jpeg" style="height:640px; width:960px" class="img-responsive credit_i_img">
	</li>
	<li>
	Correct mistakes in credit report: Your credit report can contain errors, and it is your responsibility to see that there are no errors. Understand, credit bureaus handle hundreds and thousands of credit reports a year, and this there can be errors easily. It is up to you to check. If you do find mistakes, report it to the credit bureau and they’ll take care of it.
	</li>
	<li>
	Ask the lender to consider your application with NA or NH in the credit report: This means that there has been an absence of credit in the last 3 years. If so, you may not have a credit score at all. In such cases, talk to your lender about this credit inactivity, and if you can get a loan. The interest rate shall be slightly higher.
	</li>
</ol>

These are measures which can help give you a personal loan despite having a poor credit score. It is important to have funds enough to repay them, otherwise your score shall go even further down.

Having a low credit score is not good for your loan prospects. Here's how you can get a loan even with a low credit score.

How Can I Get A Personal Loan With A Bad Credit Score ?

<h3 class="credit_i_h3">What is an SME Loan?</h3>

SME loans are special loans for Small Medium Enterprises. These are business loans that are extended to enterprises of a certain size only. As you can see, these are not given to large organizations. Moreover, the benefit of an SME loan is these are highly customized to suit the needs and requirements of the lender’s clients. The main purpose of SME loans is to meet the needs and requirements of small and medium sized companies. 
Small-sized businesses have the perpetual difficulty of getting funds. Medium sized enterprises are faced by this problem too. For them, SME loans are very useful.

<h3 class="credit_i_h3">What do you mean by SME?</h3>

SME is a term to denote Small and Medium Enterprises. The term is useful for segmenting companies and organizations of different sizes. It is to segment businesses, companies and organizations based on their size. According to the European Union, an SME is one that is legally independent as a company and has less that or just 500 employees. Of course, only a medium sized company will have anything close to 500 employees, but fortunately, it also benefits from SME loans.

A small company is one that has investments of more than Rs. 10 lakhs but less than Rs. 2 crores. A medium company is one where the investment is more than Rs. 5 crores but is less than Rs. 10 crores.

<h3 class="credit_i_h3">Why are SME loans important?</h3>

SME loans are very important for the economy, especially right now. These play a significant role in creation of new job roles in any economy. By helping to create capital for companies, it indirectly aids in job creation. Studies have in fact shown than a considerable portion of job creation around the world is due to SME loans. Likewise, these loans contribute to a country’s GDP and ensure money flow across the economy.

One of the features of these loans is that these charge lower interest rates to clients than large banks. This enables clients to benefit from cheaper loan deals.

<h3 class="credit_i_h3">What are the benefits of SME loans?</h3>

There are several benefits in getting these loans, such as: 
1) Identification and investing in specific and unique niches 
2) It is able to react faster to market and economy changes due to smaller size of companies 
3) SMEs help in building better relationship with employees and customers 
4) It helps the economy by creating jobs, lowering poverty and raising the GDP of a country

&nbsp;

FAQs on SME Loans are very common among entrepreneurs who wish to avail these loans. Get all these doubts about SME Loans cleared at mymoneykarma.

What is an SME Loan? - FAQs on SME loans

Desperate times call for desperate measures. The coronavirus or Covid-19, a pandemic that broke out in China, has now spread out to almost all countries of the world. India is afflicted with this as well.

<h2 class="credit_i_h2">The Great EMI Relief</h2>

Thankfully , a&nbsp;moratorium of three months of EMIs on all outstanding loans has been announced.

<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">

The statement says: "All commercial, regional, rural, NBFCs and small finance banks are being permitted to allow a 3-month moratorium on payment of instalments in respect of all term loan EMIs outstanding on March 31."

<img alt="RBI 3 months moratorium on EMIs" src="https://mmk-s3-cms.s3.amazonaws.com/1587983413634.jpeg" style="height:640px; width:960px" class="img-responsive credit_i_img">

For the next three months, no EMI will be deducted from the account of anyone who has a loan outstanding. And all this without any hit on credit score. EMIs will resume after the moratorium period gets over.

This is going to be a huge relief for all EMI payers, especially for those — such as the self-employed — whose income had become uncertain in the wake of the lockdown.

The 3-month moratorium will apply to corporate loans, <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">home loans</a>, and <a href="https://www.mymoneykarma.com/personal-finance/i/how-to-pay-off-your-car-loan-faster.html" target="_blank">car loans</a>. <a href="https://www.mymoneykarma.com/credit-score/personal-loan-credit-score.html?utmsrc=personalloan_enquiry" target="_blank">Personal loans</a> will also qualify for this.

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.

&nbsp;

3 Months Moratorium - RBI has decided to waive off EMIs for all loans for 3 months, in the wake of covid19. Find out more at mymoneykarma. 

RBI 's 3 Month Moratorium

<h2 class="credit_i_h2">What is a personal loan?&nbsp;</h2>

Before we at mymoneykarma give you all the details on how to how to apply for a personal loan, let’s tell you something about personal loans first. 
 
A <a href="https://www.mymoneykarma.com/personal-loan.html">personal loan</a>, simply put, is a loan approved for personal reasons or personal expenses. This can be anything from a home renovation, a wedding, a family vacation, or for anything that you personally need. This is different from a corporate loan or a business loan, where you take credit for meeting the expenses of your business or company. 
 
In the case of a personal loan, you take the funds for personal reasons only. The good news is that in the case of personal loans, there are fewer regulations on the final use of the funds. This means that you have a greater degree of freedom to use the funds for any purpose, as long as it is legal. 
 
Personal loans are attractive for two main reasons.&nbsp;

<ol class="homeloan_Faqs_ul_1">
	<li>
	You have the flexibility to use the loan amount in any way you see fit. This is a stark contrast to auto loans and <a href="https://www.mymoneykarma.com/home-loan.html" target="_blank">home loans</a>, in which you need to spend the amount for buying a car and home, respectively. In most cases, car and home loans are disbursed directly to the seller.
	</li>
	<li>
	All personal loans are unsecured loans. This means that you are not required to give the lenders any security like assets or cash. This makes personal loans more accessible to customers who do not wish to provide money or assets as collateral. 
	&nbsp;
	</li>
</ol>

<h3 class="credit_i_h3">How to apply for a personal loan?</h3>

There are several ways in which you can apply for a personal loan. Some financial institutions require you to log in at their website and then apply for a loan directly from a bank or NBFC. Alternatively, you can also go to the bank branch in person to apply for a loan.&nbsp;

<h3 class="credit_i_h3">How can mymoneykarma help you in getting a personal loan online?</h3>

When you want a loan of any kind, you have to approach the bank or other lenders directly. That can be quite a hassle. We understand that, and that’s why we do the heavy-lifting for you. 
Let’s say that you want a personal loan for Rs. 1,00,000. You approach us and tell us about your requirements. mymoneykarma is partnered with various notable banks around the country like Axis Bank, SBI, and HDFC Bank, to name a few. Hence, you can compare the various loan products from all these banks and pick the one that suits you. Based on your wish, we approach our partner to give you the loan. 
3 steps to a personal loan online

<ol class="homeloan_Faqs_ul_1">
	<li>
	Visit mymoneykarma website or click here to be taken directly to the <a href="https://www.mymoneykarma.com/personal-loan.html">personal loan portal</a>.
	</li>
	<li>
	Compare <a href="https://www.mymoneykarma.com/personal-loan-interest-rates.html">loan interest rates</a> and calculate your <a href="https://www.mymoneykarma.com/personal-loan-emi-calculator.html">personal loan EMI</a>.
	</li>
	<li>
	<a href="https://www.mymoneykarma.com/credit-score/personal-loan-credit-score.html?utmsrc=personalloan_enquiry">Apply</a> right away.
	</li>
</ol>

You can also choose from various personal loan types like <a href="https://www.mymoneykarma.com/personal-loan/wedding-loan/">wedding loans</a>, <a href="https://www.mymoneykarma.com/personal-loan/holiday-loan/">holiday loans</a>, <a href="https://www.mymoneykarma.com/personal-loan/premium-bike-loan/">premium bike loans</a>, <a href="https://www.mymoneykarma.com/personal-loan/rental-deposit-loan/">rental deposit loans</a>, <a href="https://www.mymoneykarma.com/personal-loan/salary-loan/">salary loans</a>, and <a href="https://www.mymoneykarma.com/personal-loan/credit-card-takeover-loan/">credit card takeover loans</a>.

<h2 class="credit_i_h2">Where can I go for taking a personal loan online?</h2>

There are several places where you can go for getting a personal loan. Note that getting loans from some of these sources is tougher than the rest. Moreover, they may also differ in terms of qualifying criteria like salary level, nature of your job, educational qualification, and more.

<ul class="banklogin_ul">
	<li>
	Banks: It can be tough to get loans from banks, even though these are the most preferred avenue. Getting funds from a bank is convenient and secure. In most cases, banks prefer candidates who already have an account with them. You can improve your chances by having a co-guarantor. In this way, you get the funds, but your co-guarantor will also be responsible for paying it back. If you choose this option, make sure that your finances are in good order.
	</li>
	<li>
	P2P Lending: Peer-to-Peer lending is a comparatively new development. You can get loans from money lenders, along with suggestions and multiple loan options. This option can be helpful if you do not qualify for credit through mainstream channels.
	</li>
	<li>
	mymoneykarma: Visiting multiple banks or lenders can take a lot of time and energy. mymoneykarma makes it easier for you. Just visit our <a href="https://www.mymoneykarma.com/personal-loan.html">personal loan portal</a> and we’ll take over from there!
	</li>
</ul>

<h3 class="credit_i_h3">How Can I Qualify for Personal Loans Without Collateral?</h3>

Unsecured loans may seem attractive as you do not need to give any collateral, but there’s a catch. Banks do not offer loans to just anyone. Candidates are chosen very carefully based on their ability to pay back loans. For this, banks see your debt to income ratio. 
If you are still interested in getting a personal loan online, here are the fool-proof steps you need to take.

<ul class="banklogin_ul">
	<li>
	Check your credit score: No one is going to give you a personal loan just like that. One of the main determinants is your credit score. Most lenders will not tell you outright what credit score they are looking for. However, know that generally, they mean good to an excellent score. This means anything upwards from 740. Before applying for any loan, ensure that you know what your credit score is and from where you can get it. mymoneykarma helps you to <a href="https://www.mymoneykarma.com/credit-score/credit-score.html?utmsrc=winner1">check your credit score for free</a>!
	</li>
	<li>
	Get your latest credit report: Credit score shows you how creditworthy you are, but still does not show the whole picture. Lenders often need a bit more detail. This detail is obtained from your credit report. The good news is that you are eligible to get one free report from each of the three credit bureaus namely, Experian, Equifax, and TransUnion. Credit Report is important as it shows outstanding debts, repayment history, and other factors that determine your credit score. At mymoneykarma, we help you to make sense of your Credit Report!
	</li>
	<li>
	Pay bills on time: You can improve your credit score by paying back all your bills on time. Doing so shall increase your creditworthiness and your credit score, which shall increase your chances of getting a loan.
	</li>
	<li>
	Pay back your debts: Another important determinant factor of your credit score is your debt-to-income ratio. Have a high ratio? Try paying back all your debts first before applying for any loans. You can do this by making extra payments, taking a side job or by increasing your income.
	</li>
	<li>
	Have a stable source of income: This is one of the most important factors. Having a stable income means that you will be able to pay off the loan no matter what. Some lenders even have a specific income range as a qualifier.
	</li>
</ul>

Is a low or damaged credit score bothering you? Is it keeping you away from getting a personal loan online? mymoneykarma is there to help you out - we offer expert credit repair services as well.

<h2 class="credit_i_h2">Which bank has the easiest personal loan approval?</h2>

For this, you’ll have to do a bit of research on your own. However, <a href="https://www.mymoneykarma.com/personal-loan-interest-rates.html">here</a> is a very handy link. Here you can compare and learn about:&nbsp;

<ul class="banklogin_ul">
	<li>
	Personal loan interest rates and processing fees
	</li>
	<li>
	How to get the best interest rates for personal loans
	</li>
	<li>
	Dos and Don’t while applying for a personal loan
	</li>
	<li>
	How to compare personal loan interest rate of all banks
	</li>
	<li>
	How you can increase your chances of getting a personal loan
	</li>
	<li>
	Documents you need to apply for this loan
	</li>
	<li>
	Handy examples of a personal loan
	</li>
</ul>

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

Which bank is easiest to get a personal loan from? 
There are several ways to get a personal loan: from a credit union, a bank, or an online lender. What the interest rate shall be and what kind of loan it shall be is dependent on your credit score. The higher your credit score is, the widest range of the best credit options you’ll get.

What documents are needed to apply for a personal loan? 
Here are some of the documents that you need to get a personal loan:&nbsp;

<ul class="banklogin_ul">
	<li>
	Employment information and income information.
	</li>
	<li>
	Bank statements and account information.
	</li>
	<li>
	Collateral.
	</li>
	<li>
	Credit report.
	</li>
	<li>
	Identification documents.
	</li>
</ul>

How can I get a personal loan fast? 
If you need a personal loan fast, here are a few things that you could do:&nbsp;

<ul class="banklogin_ul">
	<li>
	Approach personal lenders
	</li>
	<li>
	Get cash advance on your credit card
	</li>
	<li>
	Consider a secured loan
	</li>
	<li>
	Think about getting a payday loan
	</li>
	<li>
	See if you can get loans from a family member or from a friend
	</li>
</ul>

OR

<a href="https://www.mymoneykarma.com/credit-score/personal-loan-credit-score.html?utmsrc=personalloan_enquiry">Apply for a personal loan</a> from mymoneykarma

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

If getting a personal loan online quickly is your aim, mymoneykarma shall hold your hand throughout this journey. As we are partnered with the top banks in India, we can provide you the best loan offers. <a href="https://www.mymoneykarma.com/personal-loan.html">Get in touch with us</a> today so we can start helping you!

&nbsp;

How to apply for a personal loan at mymoneykarma?mymoneykarma helps you helping you find a personal loan online with the lowest interest rate.

How to Apply for Personal Loans | Get Instant Personal Loan in 2021

Taking a personal loan won’t mar your credit score or credit rating by itself, but it can adversely affect the overall score. This can make it tough to get a new line of credit such as loans and credit cards. This means you need to pay back this personal loan before getting anything else for a while. 
 
If you can pay back this loan on time, more power to you! Your credit score will get a boost.

<h3 class="credit_i_h3">5 factors that affects Your Credit Score</h3>

You already know how the credit score works, right?

No?

Still a bit confused about it?

Don’t worry! We’re going to go through all that again now.

<ul class="banklogin_ul">
	<li>
	Payment history: 35%
	</li>
	<li>
	Outstanding debt: 30%
	</li>
	<li>
	Credit history: 15%
	</li>
	<li>
	Credit mix: 10%
	</li>
	<li>
	New loans: 10%
	</li>
</ul>

As you can see, new loans constitute 10% of your credit score. Taking a new loan on top of taking a personal loan can affect the score quite a bit since your outstanding debt increases.

How much this affects your score depends on your credit history.

Have you been paying off your loans on time over the years? If yes, then taking a new loan won’t affect your credit score by a significant margin.

Have a low credit score? Not sure if your score is high enough?

Don’t worry!

Here’s how to boost your credit score.

<h3 class="credit_i_h3">Boosting your credit score to get a new loan</h3>

Want a simple way to boost your credit score?

All right, here it is:

Pay back your loans on time!

Ask any expert, and they will tell you the truth. The safest and easiest way to increase your credit score over time is to pay back loans on time. Since paying back on ime shows financial responsibility, your credit score is affected positively.

<img alt="How To Improve your credit score ? | Repayment of Loan" src="https://mmk-s3-cms.s3.us-west-2.amazonaws.com/1588164716559.jpeg" style="height:640px; width:960px" class="img-responsive credit_i_img">

So, now you know pretty much all about a personal loan, except possibly its modes of payments. That’s what we’ll cover next.

<h2 class="credit_i_h2">Modes of Payment</h2>

Different lenders adopt different paying modes. Sometimes, you see this difference between banks too. Thus, it pays to know about the payment forms.&nbsp;

<ol class="homeloan_Faqs_ul_1">
	<li>
	Electronic Clearance System (ECS): This is one of the most popular repayment systems. With ECS, you can transfer funds from your account to someone else’s. And since it does not commence without your express permission, it's very safe.
	</li>
	<li>
	Post Dated Cheque (PDC): The concept of a Post Dated Cheque is that a PDC can only be used on or after a certain date, not before. That makes it ideal for paying bills and for encashing/depositing funds at the bank.
	</li>
	<li>
	National Automated Clearing House: There is a program called NACH (National Automated Clearing House) offered by the NCPI (National Payment Corporation of India). This program is offered to all banks and financial institutions and allows processing of real-time transactions. You can repay loans with the NACH.
	</li>
	<li>
	Debit mandate: This is similar to the ECS since it too requires your permission for the transferring of funds at regular intervals. On getting this permission from you, the bank starts transferring funds from your account for a loan repayment.
	</li>
</ol>

From all of us at mymoneykarma, we hope that helps you!

&nbsp;

Do Personal Loans affect your credit score? If so how can you prevent it? In what ways can you make repayments effectively? Find out at mymoneykarma.

Personal Loan Factors That Affect Credit Score In 2021

It is really economical to take a loan against your property. We understand that you think that this is a big loan, and that the risk can be too much. This is a common fear, not just in the case of loans against properties, but for most other types of loan. As long as a loan is a secured one, there is a risk of course, but you won’t need to worry about that since you’ll only be given the loan if you are deemed to be qualified for it.

That means that banks and other lenders shall make sure that you can repay the loan. This is beneficial not just for them, but for you too. You repay the money back on time and even get an increase in your credit score, and they of course don’t lose their money!

Now, a loan against property is also beneficial for you since it saves you a lot of interest. It is a secured loan, which means unlike the unsecured forms of credit, here you don’t have to pay a lot of interest. The interest rate is low. These come with long repayment tenures, which mean that you have a considerable time to plan your repayment. Tenures can be chosen according to your requirement.

<h3 class="credit_i_h3">Why are loans against property economical?</h3>

<ol class="homeloan_Faqs_ul_1">
	<li>
	Low interest rate: In these loans, the interest rate starts at 8.5%. The interest can increase in case of certain factors like the property’s value, the loan amount, and your ability to repay it.
	</li>
	<li>
	Minimal documentation: For loan against property, you need minimal documentation. 
	<img src="https://lh3.googleusercontent.com/kfQ_vIPwB_jn7QCln51xeSM3gRaoybu5c0Swt483ICOWiZL2G8Mmc_v-JMwC05EvuY-INuv3no9bvHv6vrYFGnXTC4rqqb5c5nZngarQj0nMUIYlBXYt0uOj4V2V_w" style="height:416px; width:624px" class="img-responsive credit_i_img">
	</li>
	<li>
	Loan tenure: You can get loan tenure of as much as 15 years. Sometimes, you can get even longer repayment tenures. This is very good for those who want a longer time to repay the loan, which gives them the benefit of smaller EMIs.
	</li>
	<li>
	No income proof is needed: Here’s another huge benefit. You do not need to show your income proof. All you need is a viable property which is either in your name, or in the name of your spouse, children, and so on. Banks and other lenders do not typically check for income proof, which is a big boon for those looking for emergency money.
	</li>
	<li>
	You don’t need to show a credit score: As said above, the valuation of your property counts for more than credit scores and salary. This is actually beneficial for those with low credit scores, or for those without any credit score at all.
	</li>
	<li>
	Property safety: The property shall remain under the lender’s name. It shall be given back to you after the repayment is complete.&nbsp;
	</li>
</ol>

<h2 class="credit_i_h2">Documents you’ll need for a Loan Against Property</h2>

<h3 class="credit_i_h3">1. Identity proof</h3>

•Aadhar card

•Passport

•Driver’s licence&nbsp;

•Voter’s ID

<h3 class="credit_i_h3">2. Address proof</h3>

•Aadhar card

•Ration Card

•Telephone Bill

•Electricity Bill

•Voter's ID Card

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

<ul class="banklogin_ul">
	<li>
	3 Bank statements for the last 6 months
	</li>
	<li>
	Pay slip or form 16&nbsp;
	</li>
	<li>
	Copies of all the property documents for the property that is to be pledged for the loan amount
	</li>
</ul>

Is loan against property actually a good option if you find yourself strapped for cash? Can it be repaid without much burden? mymoneykarma provides the answers.

Loan Against Property - Is It Economical To Take Loan Against Property

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?

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The last few years, the gold loan business has been performing quite well. In fact, its good performance has led many new companies to try their luck in this industry segment.&nbsp; Right now, however, the situation has changed drastically. The companies who arrived in the industry to try their luck, and even the big industry players who were already there, are having second thoughts. Should they bail out, shut down, or continue trudging onwards?

Right now, it is a dying business if you are an NBFC (Non Banking Financial Corporation). But if you are a bank, well, things are not so bad for you. The thing is that the RBI has put a whole lot of restrictions on NBFCs. There are many rules in place to curb their unchecked growth, and to bring the gold loan industry under a more national control under the RBI.

Since it was not possible if an NBFC operates without any regulations, the central bank now gives several guidelines and has imposed many restrictions on NBFCs. For instance, there are severe restrictions on an LTV that these institutions can have for <a href="https://www.mymoneykarma.com/gold-loan.html" target="_blank">gold loans</a>.

<h3 class="credit_i_h3">What is happening right now?</h3>

Right now, NBFCs have to stick to a cap of 60% LTV. This means that if the value of your gold is Rs. 100, you will get Rs. 60 as the loan. Add in things like extra charges and processing fees, what you get in the end is pretty less. The situation for NBFCs this year is not good. In fact, many have projected a flat growth curve in 2020.

The RBI arrangement for more capital requirement for these institutions from 10% to 12% has heightened the problem. Things are bad enough to stop the expansion of major players in this industry segment like Manappuram Gold, Muthoot Finance and Shriram city. Some NBFCs are closing down their non-viable branches to overcome the current problem. The RBI has also restricted primary gold and gold coin sales by them.

<h3 class="credit_i_h3">A bad time for GFCs</h3>

When the NBFCs are losing, banks are winning in the gold loan business. Very recently, the RBI has denied all; requests by NBFCs to allow similar regulation of gold loan activity which the central bank has sanctioned for banks all over the country. All of this goes on to show that the RBI is concerned over NBFCs capacity to handle doing business in this sector, and to go on doing business in adverse situations like the pandemic lockdown.

We know that gold is one of the most powerful investment assets in the country. Recently, the huge import volume of the metal has strained its value in INR over foreign currencies. This has prompted the RBI to try bringing out gold deposits in homes that lie unused, sometimes for generations. To make this a possibility, the RBI needs reliable and strong channels like banks. These are controlled and regulated by the RBI. According to the central bank, NBFCs cannot be compared to banks, as these make up a very small part of this industry. However, these still need to be regulated from the center.

<h2 class="credit_i_h2">Are Banks better than NBFCs for Gold Loans?</h2>

As gold rates are soaring up, gold loans are becoming lifelines for traders, small businesses, and self-employed &amp; salaried individuals in search of relief from financial troubles caused by the pandemic. When it comes to deciding on a Gold Loan, one of the first calls is to decide on the financial institution - which can be either an NBFC (Non-Banking Financial Company) or a bank.

There are many factors to be taken into consideration before settling on an option, starting with interest rates and value for the gold right up to how safely the gold articles will be kept once they are pledged. When both NBFCs and banks claim to have an upperhand in each domain, how does one come to a conclusion? Here’s all you need to know on how Banks and NBFCs differ when it comes to Gold Loans:

<h3 class="credit_i_h3">Rate of Interest</h3>

Understandably, the amount that will have to be paid as interest is a primary concern for most borrowers. The rate of interest is decided by the lender depending on how much it costs for them to provide the funds. As NBFCs generally cannot draw sizable deposits, their interest rates tend to be quite high when compared to that of banks, who have easy access to much more capital. NBFC Interest rates can be as much as 24-29% whereas for banks, the rate is normally 11-16%. Moreover, banks are also likely to offer preferential interest rates for their existing customers.

<h3 class="credit_i_h3">The Loan to Value (LTV) Ratio</h3>

Loan to Value is the loan sum you can get for a given amount of collateral. The maximum such percentage that can be provided as a Gold Loan has been capped at 75% of the value of the gold, by the RBI. For instance, for gold that costs ₹ 10 lakh, you can avail a maximum loan of ₹ 7.5 lakh. However, as mentioned before NBFCs have to stick to a cap of 60% LTV, once again giving banks the upperhand.

<h3 class="credit_i_h3">Loan Duration/Tenure</h3>

Gold loans can provide funds for any kind of financial need. However, they are known to have short tenures, which makes them not qualify as long-term options. Even so, banks generally offer longer tenures as compared to NBFCs. For example, you can get a Gold Loan from HDFC Bank with tenures ranging from 3-24 months, while NBFCs have a maximum gold loan tenure of 12 months. Longer tenures help bring down borrowers’ monthly expense on repayment, which is a great relief when it comes to managing your budget.

<h3 class="credit_i_h3">Terms of Repayment</h3>

Both banks and NBFCs do well in this aspect. The following three options are offered by all lenders in general:

a) EMIs - This is the regular repayment schedule you can opt for on term loans, covering both interest and principal.

b) Interest Upfront – In this, you can pay interest first, and then pay the principal amount at the end of loan tenure.

c) Bullet payment - The bullet payment option lets borrowers repay as a lump sum on maturity; interest and principal together. Although the interest is calculated every month, it is collected only at the end of tenure.

If you choose to get a gold loan from a bank, <a href="https://www.mymoneykarma.com/loans/gold-loan-overdraft-vs-gold-loan-EMIs.html" target="_blank">Overdraft</a> facility also becomes one of the options available to you. If you avail your gold loan as overdraft, interest is calculated only for the amount utilised from your account. It also becomes easy to renew or top-up the loan. As per your expectations, you can choose from any of the above repayment options from a bank.

<h3 class="credit_i_h3">Easy Processing and Access</h3>

<a href="https://www.mymoneykarma.com/loans/gold-loan-vs-personal-loan.html" target="_blank">In comparison to personal loans</a> and other loans, gold loans are easy to avail and the process is quite straightforward. They are processed quickly, and don't need you to furnish income documents or credit score. So, all lenders manage to provide loans on the same day of application, within hours. A bank can even disburse a gold loan within just 45 minutes, with very little documentation.

<h3 class="credit_i_h3">Customer service</h3>

Responsible and accountable customer service is an important part in the process of availing any loan; as a customer, one might have a number of queries that need to be addressed. While NBFCs do have customer helpline numbers that are available during working hours on working days, banks tend to 24x7 customer service - offering instant solutions to all queries.

<h3 class="credit_i_h3">Additional Fees</h3>

The fine print for a gold loan can have certain charges that are added. It is important to be updated about the terms and conditions to save yourself from unpleasant surprises. Customers prefer to always look for a provider that offers complete transparency in this aspect. Banks generally have low processing rates and such other fees as compared to NBFCs.

<h2 class="credit_i_h2">Can NBFCs fight back?</h2>

All of these are having a serious effect on NBFCs. However, there is a silver lining in this dark cloud. They have more time to develop better financial products. Their market is a niche one, and that means they can reach more of certain sections of the customers that banks cannot. At the same time, they need to sustain their business longer and provide more, and certainly better financial products.

&nbsp;

NBFCs Gold Loan plans are finding it hard to compete in the market, with several restrictions and banks picking up their game. Find more about the state of NBFC gold loans at mymoneykarma.

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