​Top 3 Tips to Help Lower Your Housing Loan EMI burden

Taking a housing loan in India is a crucial decision. You need to do your homework to secure the best deal, otherwise it can cost you significantly, as it is a long-term loan that goes on for 15-20 years. One of the major factors to look out for is the housing loan interest rate and not getting the lowest one can turn out to be costly. It is, therefore, essential to check that you tick the right boxes right at the beginning. Here are a few tips a housing loan borrower can lower the EMI outgo.

Compare Housing Loan Interest Rates, and Look out for the Lowest

Many lenders offer their best rates to salaried professionals and charge a higher rate to non-salaried individuals. Reasonable rates are offered to those with high credit scores. You must, hence, check the best rate you can avail of against your current credit score and credit report. Having a female home loan borrower as a co-applicant can also help you lower your interest by about 0.05%. So, if you avail of the loan with your spouse, you may get a better deal. In other words, the lowest rate is not offered to all borrowers. The best thing to do would be to shortlist five to seven lenders and check their terms and conditions to secure the lowest home loan rate.

Select the Right Property

Sometimes, the home loan interest rate is not the issue, but the property is, owing to which the lender might not approve the home loan. Many lenders have a list for types of localities and properties for which they do not sanction loans. Check with your lending institution if the potential property is going to be financed, before finalizing it. 

Arrange for a Higher Housing Loan down Payment

Most lenders save the lowest rate of interest for borrowers who can maintain a low loan to value (LTV) ratio via a higher down payment. So, if you make a down payment that exceeds 20-25%, you may be able to secure the lowest housing loan interest rate the lending institution is offering. So, a higher down payment reduces the EMI outgo by keeping the outstanding loan amount low and can also help you land a comparatively lower home loan interest rate.

We hope these tips will help you get the best rate for your dream home.

Read Also: 4 Tips for Choosing the Best Home Loan