House Finance
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House Finance

Last updated on March 18th, 2019 at 10:28 am

Financing your home is the need of the hour as you may not enough capital in your hand to invest in your dream project. It is always desirable that you opt for a new home rather than buy a property on resale. This is because you can avail of numerous advantages like better energy efficiency, modular fittings, low upkeep or maintenance expenses, easy customization of the area as per your needs etc.

Before seeking to finance your home, you need to have an estimate prepared. The tentative budget for the project should be determined in consultation with a civil engineer and factoring in the various tax rates prevalent in the area. You need to have your building plan approved of from an authorized representative of local civic body like municipality.

Next, you need to ascertain your credit rating to learn about the maximum loan amount you are entitled for. The recent government has launched ‘Pradhan Mantri Awaas Yojna’ under which home loans are available at attractively low interest rates for different income groups. You need to get in touch with the banker or lender to have your loan request registered for the amount you can afford. You can also approach State Bank of India which offers home loans at 8.35% interest rates in instalments.

Before approaching the lender, prepare a comprehensive list of the amenities that you wish to have developed within your proposed home. Get the cost estimate prepared and certified from government accredited surveyor and civil engineer. Present the detailed plan to the loan section of the bank. Submit your financial portfolio to develop conviction of bank in your capability to repay the loan through its entire lifetime. You can also get yourself accompanied by a real estate expert with commendable credentials to present your case in emphatic manner.

Bank considers construction related loans to be more risky. This means you should possess a clean and strong credit rating. The cost of the plot on which the house would come up and approximate cost of building would be considered to determine the amount to be loaned out. Since the land would be registered in your name, this equity can be used to get the loan application processed faster. The loan would be disbursed in instalments only after you furnish visual proof of the progression of construction. Home finance is a complex subject and you should seek the experienced support of an agent to get your loan processed expeditiously.