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Can I get a 90% Home Loan?
Posted on Friday, December 30th, 2022 | By IndusInd Bank
For decades, buying a home has been seen as the hallmark of success and a major life milestone. It’s likely to be the biggest purchase that one makes in their life. But buying your dream home can be a very expensive affair. The residential property prices across 8 major cities of India (Delhi-NCR, Mumbai, Bangalore, Chennai, Hyderabad, Kolkata, Ahmedabad and Pune) have seen a 5% average annual increase during Q1FY23. Experts have attributed the rise in housing prices to a hike in rates of key building materials as well as labour wages, besides some strong fundamentals.
Choosing the correct home loan – a checklist
In such scenarios, finding the perfect home loan becomes just as important as finding the perfect home. The correct home loan that matches your financial goals will make your repayment journey simple and stress-free. Similarly, a wrong home loan choice may push you in a debt trap & financial insecurity, and create obstacles for any future loans you want to take.
To help you select the home loan that meets your requirements, here are 5 things you must follow.
1. Compare interest rates – The home loan interest rate varies from bank to bank, and also changes from borrower to borrower based on repayment capability, credit score, loan amount, etc. IndusInd Bank offers attractive rate of interest on its home loans to make your dream home affordable and easy on the pocket.
2. Pick an optimal loan tenure – It is crucial to select the most appropriate tenure for your loan. A longer tenure reduces the EMI, but the interest outgo increases. Whereas a shorter tenure will mean higher EMIs and can be heavy on the pocket.
3. Verify processing charges – These are charged by the bank to cover cost incurred during the processing of loan application, assessing property value and verifying other details mentioned by you. The charges vary across banks.
4. Go through the foreclosure norms – Several banks charge the borrowers for closing their home loan early. However, with IndusInd Bank, you can pay off your loan at any time without paying any extra charges.
5. Look at the non-financial aspects as well – During your home loan tenure, you will be interacting with your lender several times. The lender should be easily accessible to the borrower for a stress-free experience on both ends. This is why IndusInd Bank offers superior post-disbursal service and is highly responsive to customer requirements.
Can I get a 90% home loan?
When paying for a house, you will have a mix of two components: –
1. Percentage of the property value that a bank will lend you as home loan
2. The remaining property value that you will pay upfront from your own pocket – the down payment.
Banks are not permitted to lend/finance the full property value, hence, you cannot avail 100% of your property purchase price as a loan. But you can avail a 90% home loan under certain circumstances.
According to the guidelines issued by the Reserve Bank of India (RBI), home loans can go up to 90% of the property value for loan amounts of Rs.30 lakhs and below. You can avail an 80% home loan for loan amount between Rs.30 lakhs to Rs.75 lakhs. If the property value exceeds Rs. 75 lakhs, you will have to pay the 25% of the total property value as down payment, and avail home loan of 75%.
| Property Value | Loan Percentage | Down Payment Percentage |
|---|---|---|
| Less than Rs. 30 lakhs | 90% | 10% |
| Between Rs. 30 to 75 lakhs | 80% | 20% |
| Above Rs. 75 lakhs | 75% | 25% |
Conclusion –
Home loan is an amount of money borrowed by individuals to buy a desired residential property, which they repay with interest amount over a period of time. To help you fulfil your dream of owning a home, IndusInd Bank offers attractive interest rates, longer home loan tenure, easy home loan application process, hassle-free documentation and customized repayment option. You can also transfer your outstanding housing loan, or avail a top-up on your existing home loan with minimum paperwork. Apply now!
Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.
