How to Select a Good Home Loan Product?


Take any middle-class Indian couple, who have migrated to a city for professional reasons- owning their own home will be their biggest dream. In addition to giving the assured feeling of residing in your own home, buying a house also gives a sense of achievement to the middle-class buyer. No wonder, builders are catering to middle-class buyers with different financial appetites, a wide variety of home in all major cities in texas current mortgage rates in texas is low.

Selection of a home is a complicated process. You have to take into account your personal preferences, distance from your work location, distance from schools and hospitals and proximity to daily shopping and weekend entertainment needs. Selecting a home loan is an equally complicated process. While most people spend the required amount of time and due diligence in choosing a home, they ignore the selection of the best-suited loan product for their financial needs. Considering that home loan EMI will constantly figure month after month in your budget for around 15 to 20 years, means that you should be carefully evaluating every aspect of a San Antonio Mortgage Lender before opting for it.

Following are some pointers that will help you select a good home loan product:

1. Compare interest rates judiciously

Banks offer loan products with teaser interest rates wherein the interest rate for initial few years will be lesser, but post that the interest liability on the consumer would be comparatively higher. In a way, it is advantageous to you because, in the initial years of your repayment, the interest burden on you will be lower. As years go by, your income should increase as a result of pay hikes and promotions. This will enable you to bear the burden of a higher interest rate. Nevertheless, be aware of the fact that a teaser interest product will require you to pay higher interest in later years.

2. Negotiate for the lowest possible processing fee

Banks generally charge 0.5-1.5% of loan amount as processing fee. As you will have to pay this amount while applying for the loan, try to negotiate the lowest possible processing fee. Banks tend to offer discounts in a processing fee to clients working in corporate sectors and to clients who buy during certain offer periods.

3. Check the bank disbursal process

Private Banks generally have a more natural disbursal process. If you are purchasing a home under construction, the builder will demand you to pay as per the stages of completion. So if the banker takes more time and has a cumbersome process of evaluating and disbursing the loan amount, it may cause you trouble. Check with your friends or on internet forums about how customer friendly the operations of the bank are before signing the dotted lines.

4. Look out for value additions offered by the bank

Gone are the days when a bank’s job was to provide you with cash for your home purchase merely. Banks nowadays provide you assistance in selecting a property, negotiating with builders for bulk deals, doing a legal assessment of your property, etc. This can save you time and money and give you access to excellent housing deals.

A good home loan will make your dream of owning a house much more accessible to achieve. The time and effort you spend in this process will definitely pay you rich dividends over the years.