1.Go with a lender you trust. Go with someone who has been in the market for at least a few years and is reputed and recognized by the Reserve Bank of India.
2.Negotiating for a low home loan interest rate is more important than you think. The interest rate you get will define how easy or difficult it will be for you to repay your loan. High interest rates lead to high EMIs and high total interest pay-out. Thus, a house loan is a big commitment and there are a few things one must keep in mind while making this commitment. Low interest rates, on the other hand, make EMIs affordable and reduce the cost of borrowing the loan.
3.People assume keeping the loan tenor short is the best way to go. This is not true -- decide the tenor based on your affordability. If you can afford to pay high home loan EMIs, keep the loan tenor short and become debt-free as soon as possible. This will also reduce your total interest pay-out. However, if affordability is an issue, keep the tenor long and EMIs affordable. This will help make repayment easy for you.
4.Lastly, make sure to go with a lender who offers zero prepayment or foreclosure charges. Prepayment is the process of clearing your loan earlier than the stipulated period by making lump sum payments whenever possible. Foreclosure is the process of closing your loan early by paying the entire pending amount. If you want to become debt-free soon, go with a lender who will let you make part prepayments or foreclose your loan without paying any extra charges.
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