Why is this the right time to avail of a home loan?

Over the last two years, India has been facing a massive economic downturn, with the GDP being knocked down by 7.3% in the previous financial year. Every sector, including real estate, could not get away with this economic disorder. Due to this, property prices have become static, and the housing loan rates are the lowest. Therefore, individuals planning to avail a housing loan must know that this is an ideal time to apply for it.

Advantages of availing a housing loan now

When planning to avail a housing loan, it is wise to conduct an in-depth analysis and select the right option that suits one’s budget. So, individuals willing to invest in a property should know why it is the best time to do so, which includes:

• Lower housing prices

Since the economic deflation, property prices have not witnessed a rise. Moreover, in certain cases, there has been a notable fall in the cost of the properties. As per the RBI’s report, price of the houses dropped by 1% during the third quarter of 2020. Hence, individuals are more inclined towards purchasing economical properties. Consequently, prospective borrowers are approaching financial institutions for a home loan.

However, while applying for this credit facility, individuals must know how to check CIBIL score as it is a vital determinant considered by lenders when sanctioning the amount.

• Added benefits

Considering this situation, few developers have included multiple incentives to entice prospective home buyers. In addition, several benefits, such as no payment of EMIs until possession and a temporary slash of stamp duty charges, have further encouraged buyers’ interest.

Must Read: What is the best way to avail lowest home loan interest rate in India?

• Drop in interest rate

Due to the recent slash of repo rate by the RBI, intending homebuyers are greatly benefitted. This rate cut improves the country’s economy and significantly affects India's present home loan interest rate.

On the other hand, existing buyers can enjoy indirect advantages from their lenders. For instance, they can maximise the benefit of lower interest rates and resultantly affordable home loan EMI by changing their existing lender through the balance transfer facility.

Moreover, to facilitate hassle-free repayment, individuals need to carefully choose the home loan tenor and make a proper repayment plan.

Hence, from the aforementioned sections, it is clear why it is the appropriate time to avail a housing loan. However, borrowers need to consider certain factors before settling for a particular lender and make an informed decision.