Loan for a Home

Home Finance Companies (HFC) are a happy lot, as they are on the back of a robust growth. Home equity loan interest rates experienced a rising trend during the year. The rise was in the 25- 50 basis point range. For instance, IDBI ended the year offering home loans at an interest rate of 8.25 for fixed loans (8 at the beginning) and 7.50 for floating rate loans (same as that at the beginning of the year).The investor friendly FDI ( foreign direct investment) policies and the unparallel success attained by the Indian software giants such as Wipro, HCL., Infosys and Satyam has inspired hundreds of top notch multinationals to relocate in the country. This means improved purchasing power for the educated class and a desire for better living conditions.If you have the inclination purchasing a property or a residential apartment is no difficult task, at least not as far as finance is concerned. Money is a phone call away . And even if you have the wherewithal to finance your own accommodation, it is wiser not to dig into your savings. Loan from HFC makes more economic sense. With Banks and Financial Institutions knocking at your door or ringing your cell-phones at odd hours, the moment you disclose your intentions of procuring a house loan or a mortgage loan, its difficult to make the right choice. If your broker has not confused you in selecting your property or abode for purchase, surely the finance friends with all the mathematical calculations are certainly going to make things difficult for you. Here the mortgage calculators and other such tools can be of help for you. Choosing the right home loan is not an easy task.With so many different types of loans and lenders to select from, it would be easy to simply go in for the loan that offers the lowest interest rate. However, that is not enough. You must look at other features before you decide on a HFC. Sometimes, you may find that the HFCA you have chosen which also the lowest interest rate – charges 3 to 4 as termination fee, something not mentioned earlier. Since amounts are large and repayment periods quite long, the interest component assumes significance. Typically, the interest component over a 15 year period is larger than the principal. Obviously, one would prefer the lowest rates, subject to all other features being equal.

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