How to Buy an Independent House on EMI?

I know buying a house without a home loan is next to impossible for the average person. So, if you are trying to learn how to buy house on EMI, I can help you. In 2023, I bought a resale house. From this, I learned that the most important thing before buying a house is fixing the budget. You also need to arrange around 20% of the needed amount on your own as most banks only lend out 80% of the property cost. 

How to Buy House in EMI?

After setting off the budget, you should also check your CIBIL score, as it needs to be 750 or more. Following that, you can follow the steps mentioned below. 

• Start by applying for a pre-approved loan. Through this, you will learn about the loan eligibility before finalising the property. 

• A sanction letter will be provided to you, following which you must ask the bank to provide the property documents required for home loan disbursement.

• After loan approval, finalise the property and sign the sale agreement. Also ensure that, check all property documents in original and get photocopies. 

• Submit the property documents for loan disbursement.

• Once the loan is approved, you need to sign the loan agreement.

And that’s about it. After that, sign the sale deed and collect the necessary documents to complete the entire process. I hope this helps. 

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How to Calculate Prepayment of Home Loan?

Curious about how to buy home on EMI? Equated Monthly Installment (EMI) is a payment option that you can use to purchase a home in India. In actuality, EMI is one of the most widely used financing options for house purchases, particularly for those who are unable to make the entire upfront payment.

How to Buy House on EMI?

• The process of buying a home on EMI starts with a comprehensive financial evaluation. Determine your borrowing capacity by analysing your earnings, and savings.

• Find properties that fit your needs in terms of location, tastes, and budget by doing a thorough search. 

• After you've found a property, it's time to inquire about financing alternatives with lenders. Do some research on different financial organisations to compare terms and conditions such as interest rates, loan tenure, processing fees, and other details. These institutions include banks and non-banking financial firms (NBFCs).

• Submit a loan application to the selected lender together with the necessary supporting papers. 

• The lender evaluates the property thoroughly to determine its market value and appropriateness as collateral after receiving your loan application.

• Your loan application is approved by the lender once the appraisal and legal clearance procedures are successfully completed. The approved loan amount is subsequently paid out in accordance with the conditions of the selling agreement.

• Now that the loan has been disbursed and the property has been acquired, it is your responsibility to pay back the loan balance in installments. These installments have principle and interest components, and in order to avoid penalties and defaults, they must be paid within the allotted time.

This is how to buy a house in installments.

Benefits to Buy a House on EMI:

• When people purchase real estate with EMI payments, they can distribute the cost over a longer time frame.

• Accepting EMI payments allows borrowers to save and invest their money for other uses, such emergencies, therefore preserving liquidity.

• It is because EMIs have a set payback schedule, they make it easier for borrowers to manage their money and create budgets.

• Even if the loan is repaid over time, buyers gain ownership advantages from the outset.

I hope this helps you with how to buy home on EMI.

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How to get a home loan?

Today, if you want to buy a house, buying it without a home loan seems impossible today. You should know that you’ll have to pay EMIs every month. This amount might be quite higher than the rent you’re paying currently. So, the best way to do so is calculate how much EMI you can afford monthly on your salary. Generally, it is advised that you opt for an EMI which is approximately for 15 years at the max and 30-40% of your monthly income. Once you’ve a clear figure, it might be a good idea to start channeling your savings and investment returns. Now, you should know that a bank provides at the most 85% loan on the total amount. The remaining amount you have to pay to the builder/seller by yourself. You can approach a bank which has a good reputation and has a reasonable interest rate. Speaking about the application for home loan generally documents for Identity Proof, Address Proof, Income Documents, Property Documents and a few others is required. Additional documents might be required depending on the bank.