5 MinsSeptember 11th, 2019
Buying a home is probably the most important financial decision in one’s life. It’s a long-term commitment as repaying the loan could take a couple of decades. Hence, it is important that you cover all your bases before you make the final decision.
Axis Bank offers an attractive range of home loans to meet different customers’ needs. Before you zero in on the home you want to buy and apply for a home loan, however, here is a checklist of various aspects to keep in mind.
Budget — Fix a budget for the home you want to buy. In doing so, consider two aspects. The first is your annual income. This will be important in terms of determining the amount of loan you get from the bank. It is advisable to consider not just your annual income but also that of your spouse. Such clubbing of income will help you get a higher home loan amount. Banks typically finance only about 80-85% of the value of the property. The rest has to be raised by the home buyer. To take care of this aspect you could consider what savings and investments you have and can liquidate easily. The Equated Monthly Instalment (EMI) on the loan, ideally, should not exceed 40% of your income since you will also need funds for day-to-day expenses. Take a loan of only such an amount wherein the repayment is not a burden on you.
Another aspect to consider while fixing a budget are expenses towards stamp duty, registration, and legal fees, which will have to be borne by you.
Builder’s track record — If buying a new or under-construction property, check the developers’ track record. If some builder offers you a ‘dream deal’, it’s probably just that: a dream. Don’t buy from fly-by-night operators. Only buy property from an established builder. Most banks have a list of projects that they offer home loans for. This would be a good reference point for you to start. To know Axis Bank’s list of approved projects click here . Also, check previous projects that the builder has built. Visit those properties if possible. Find out if those projects were delivered on time, and what was the quality of construction.
Infrastructure — Your family decides the infrastructure you need. A young family needs access to schools and good connectivity for everyone. A family with senior citizens needs to have a good quality hospital close by. Everyone needs markets and malls. You and your spouse will need good transport connectivity to get to work. Check all these factors before making a decision.
Check the area for flooding — This monsoon season has been an eye-opener for the whole country. There are reports of floods everywhere. It doesn’t matter how beautiful the home looks; one season of heavy rains is enough to cause immense damage if the area is prone to flooding. Talk to people in the neighborhood, read up and watch news from the previous year. Make sure that your future home is safe from flooding.
Check the resale value — No, this is not on the list so that you can buy and sell in a short period. This is to understand what sort of neighborhood you are considering staying in. If property values in the area haven’t gone up a lot, find out why. Is the place unsafe, what are the crime rates, are people moving out in droves?
[Also Read: Advantages of Pre-Approved Home Loan ]
Consult a lawyer — Don’t hesitate to retain a good lawyer to go through all the documentation with regard to land and property: Everything from title deed, land use, occupational certificates, and approvals from municipal corporations. If it’s a resale, you have to look at property tax receipts, and loan release documents. This is probably the single biggest investment you will make so it makes sense to ensure that all paperwork is in order. Don’t regard it as an unnecessary burden.
Axis Bank offers an array of affordable and flexible home loans that are designed to suit the requirements of all home buyers. Explore Axis Bank’s wide range of products for the most competitive Home Loan interest rates , extended loan tenures and other benefits like EMIs waivers.
Use Axis Bank’s Home Loan affordability calculator that is based on your requirements, such as tenure, loan amount and interest rates to give you an estimate of your Home Loan EMI .
Disclaimer: This article has been authored by The Source, a Mumbai-based content creation and curation firm. Axis Bank does not influence views of the author in any way. Axis Bank and The Source 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. Please consult your financial advisor before making any financial decision.