Home emi calculator

Can’t Settle Your House Loan?

A few years ago, you successfully found the most suitable property loan for your condition. Almost everything had gone great and you were able to get the property of your dreams. But, the economic climate experienced some hardship despite the fact that some economic problems were were solved, the fiscal status was never the same. Because of the transformed situations, you are discovering it hard to match your monthly mortgage loan repayment.

It might be very difficult for anybody to be experiencing the same fiscal woes as yours. Failing to meet your mortgage repayments can result to default. Still do not fret as you are not the sole person enduring such a challenge. There's constantly a means to remedy this kind of problem. You only need to fix your focus straight and communicate with the right persons for help.

As fast as possible, you need to call your mortgage lender and get them to give you some help. It may well seem tiresome and no one desires to talk about their House Loan predicament. Even so, if there are people that will help you, they are your provider. They should be able to provide you with numerous solutions. But in the event you find the options they provide unsatisfactory, there's always a choice to switch to a new provider.

The fact that you are unable to make repayments signifies your credit cards may also be into their limitations. You may want to would like to speak to your credit card companies and discover exactly what agreements can be achieved. You might want to obtain a debt consolidation scheme to merge all your debts. Work with an online debt consolidation mortgage calculator to find out if a debt consolidation loan would work to suit your needs.

An alternative choice you have is refinancing. If you need to refinance your active mortgage to look for far better rates, you have to speak to mortgage broker who will offer you a precise step-by-step guide during this process. Many Australian mortgage brokers are offering refinancing mortgage loans. Go to a mortgage broker's website to learn more about refinancing. 

You can also employ a refinance mortgage calculator to ascertain just how much you will be able to save. Talk to your mortgage broker pertaining to the results from the mortgage calculator to obtain a definitive answer.

And finally, there is also the option of employing an accountant or financial specialist when you genuinely worry that you are close to defaulting. They'll give you some tips concerning exactly how you can correctly take care of your financial plans in order to avoid defaulting on your mortgage loan.

[Source: http://www.sooperarticles.com/finance-articles/mortgage-articles/cant-settle-your-house-loan-530116.html]

Documents Needed for Home loan emi calculator

As you have made up a mind to take a home to loan buy your dream house. In today's internet world you start searching on net for best offer. Search engines will take you to the different banks and financial institution websites, which provide home loans. You should also visit websites which offer advices on home loans. From there you get the idea about best interest rates, and other important information related home loan.

After doing all the research about all the factors you apply for a home loan. But most important requirement to get Home loan emi calculator is the documentation which is quite tough. In case you miss out any crucial document your home loan approval will get delayed or may be your application will be rejected.

The first thing is the filling of application form and signing it. Then go through the official site of the bank thoroughly to get information about the mandatory documents needed for applicants. The main documents required for home loan are Proof of age Proof of identity - passport, PAN card, ration card, voter ID card etc.

Banks and financial institutions have specified documents according to the applicant's category, purpose of loan, tenure, amount, etc. From the documentation column you can check the list of documents as per your category.

Salaried applicants

Salaried persons are required to submit salary slip of last three months showing all deductions along with current salary certificate, proof of continuity in job for last two years - either appointment and relieving letters or Form 16 for two years. Bank statement or pass book where salary has been credited for last six months, copy of appointment letter if employed for less than a year in current job, company profile for employees of a private limited company.

Documents related to Property

Khata certificate Latest property tax paid receipt EC for last 13 years, parent documents and all link documents for 13 years, approved plan receipts towards payments already made, in case of an old flat or house you are going to purchase - its sale agreement and title documents in favour of the seller, if you are buying a newly constructed flat then sale agreement or construction agreement with builder, total cost break-up on builder's letterhead (in case of new flat).

To get refinance

In case of getting refinance you have to submit details of previous Home loan emi calculator availed outstanding loan balance letter with foreclosure charges Letter of acknowledgment for deposit of title deeds.

Documents for self - employed

Self employed persons have to submit additional documents to get home loan. These are profile of business on the letterhead of the company, proof of IT returns for last three years, computation of income certified by a chartered accountant along with profit and loss account and balance sheets for three years, business and personal account bank statement for last one year and copy of professional certificate in case of a professional.

One thing to take care of is marginal money since banks calculate percentage according to your income and moreover banks only lend 85 to 90 percent of the loan amount.

Usually the banks ensure that monthly repayments do not cross 40 percent of your take home salary. While scrutinizing the documents bank finds applicant has a poor repayment track record and have sufficient default record on previous debts, then there are very bleak chances of getting home loan.

Article Source: http://EzineArticles.com/1356474

Home Loans - Things to Know

Home loans have made home buying in India approachable and manageable. There are many leading companies that provide customers with easy loans. In the home loan arena, government and well established companies are considered to be the most preferred loan institutions. Known for their unique and compelling propositions, these companies have enabled a hefty number of people achieve their aspirations. There is no point in signing the dotted line of a scheme, which is dripping with heavy interest rates and inconvenient operations of EMI. In simple terms, it is imperative to first understand the do's and don’ts of applying for loans.

Loan Application Requisites:

The usual protocol which banks usually follow is to keep the loan amount 60 times more than your net monthly income.

Your monthly income has to look reassuring to repay the amount in future. For example, if you wish to take a loan of Rs. 30 lakhs, it is mandatory to earn Rs. 50,000 every month.

In case you have taken personal loan or that for buying an automobile, you are not eligible to apply for a home loan.

There are certain things which are required in documentations like address proof, identity proof, income proof etc. that needs to be submitted to the bank or financial institution.

The features and benefits enjoyed by the Home Loan takers are voluminous. Although there are many features which are an integral part of the loan scheme, here are some of those mentioned.

Total Loans:

Many companies understand that purchasing your dream nest and doing all the fittings and other essential tasks would cost you a hefty amount. If you have bought a house and are moving in immediately, these companies give you a separate amount for meeting this requirement as well.

Part Prepayment Facility:

If you have paid your first EMI successfully, you can make prepayments for your loan. Monetary situations might differ from time to time, and most of the people do prefer to make chunk payments, as and when they have funds. Hence, this feature enables them to pay as many EMIs in advance as they like. However, the minimum limit for this is 3 months.

Refinance:

Buying a property with your own money can help you avail this benefit; provide you have bought the property within 12 months. You then become eligible to take loan against property which has been registered.

Prompt Repayment Benefit:

If you are an early bird and always pay your EMIs on time, then you are in for a reward. On clearing the first 12 EMIs on time, you get 0.5 % of the annual interest amount paid back, at the end of 12 months. You get to enjoy this facility for the first 3 years of your loan tenor.

Nil Foreclosure Charges:

Loan can be foreclosed at any time of your home loan tenor. The good news is that you are not subjected to any foreclosure charges.

Online Account Access:

These days, financial companies have their online customer portal that provides details like repayment track, interest certificate, payment schedule and others, regarding your loan. To avail this service, the customer has to make an account on the digital portal.

[Source: http://ezinearticles.com/?Home-Loans---Things-to-Know&id=8522378]

How to Get Lowest Interest Rates on Your Home Mortgage

Though selling and buying properties is very ordinary, at least for those who are in realty sector, it is still a tedious and time consuming process. This happens especially if you decide to do it on your own. It is good if you have made up your mind to buy a home for your family and are ready to apply for a home mortgage in a bank. Before you do so, there are some important points to consider. It is true that getting a home loan today is much easier in comparison to what the situation was a few decades ago, it is still a once in a lifetime decision as you do not buy a property every few years, do you? It is therefore necessary to do your homework before taking a plunge.

First of all, it is imperative to know the interest rates prevailing in the home mortgage sector. Then, depending upon your requirements, you can easily calculate the EMI that you have to pay to the bank that grants a home loan to you. Now, this interest rate is dependent upon many factors, most importantly upon your credit score.

If you have a decent score, you can even negotiate with the bank to lower the interest rate in your case. However, if you have a low score, do not make a mistake of presenting your home loan application to any bank manager. This is because loan advance managers judge your credit worthiness solely on the basis of your credit score. If your loan application is rejected several times, it becomes progressively difficult for you to secure a home mortgage. This is where experienced brokers working in the field of home loans come into play.

You could actually find that there are dozens of companies working in the field of home loans and refinance. Remember, you are important to them as much as they are to you. Thus, it makes sense to compare the features of the service that these companies are providing. No, you do not need to go physically to the offices of each company. Instead, you can compare the companies from your own home by logging on to the websites of these companies. Just type the amount of money you need and the Emi Calculator Home Loan that you can realistically pay to the lender. Depending young your details, you can get the rates of interest at which these companies can get you home mortgage.

The biggest advantage that these companies have is that they can match your requirements with the best available home loan product in the market. This is something that you cannot hope to achieve on your own. You not only save a huge amount of money in terms of lower rates of interest, you also save on your valuable time and effort. Just make sure that there is no fine print behind the attractive features of the company whose services you are hiring to secure your home mortgage.

[Source: http://ezinearticles.com/?How-to-Get-Lowest-Interest-Rates-on-Your-Home-Mortgage&id=6156792]

Tax Benefits Associated With Housing Loans

Multiple benefits - how?

EMI (elementary monthly installments) consists of two parts - the interest portion and principal amount. Interest paid is allowed as a tax benefit under section 24(b) (subject to restrictions), while the principle amount repaid is allowed as a deduction under section 80C.

Maximum ceiling on tax benefit

Maximum tax deduction for repayment principal component of home loan can't exceed

Rs 1, 00,000 under section 80C. One should keep in mind that other investments/contributions are also allowed as a deduction under section 80C, and this limit of Rs. 1,00,000 applies to all of them put together.

Housing loan interest deduction, on the other hand, is allowed up to a maximum amount of Rs 1, 50,000 under section 24(b). However, the acquisition or construction of the house property should be completed within 3 years from the end of financial year in which loan was taken; otherwise, the amount of interest benefit allowed is only up to Rs 30,000.

Furthermore, the above tax deduction limit u/s 24(b) is applicable only for self-occupied house property. In case of let-out or deemed to be let out house property, interest is deductible without any limit.

Starting date for claiming tax benefit

Some say that deduction on principal component of home loan under section 80C is allowed as soon as one starts repaying the home loan. Some say deduction is allowed only once the construction is completed. The law isn't clear on the matter; hence the ambiguity remains.

Interest deduction on house loan under section 24(b) is allowed only on acquisition or completion of the house property. However, interest deduction for pre-acquisition or pre-construction period is also allowed but only after acquisition or construction is complete. It is allowed in 5 equal annual installments. But even after including the above, the total deduction should not exceed Rs. 1, 50,000 per annum.

Source of home loan

Unlike section 24(b), Section 80C doesn't allow tax deduction for home loans taken from friends and relatives. For claiming tax benefit on principal component of the home loan under section 80C, you need to borrow only from the lenders specified in that section. There is no such restriction under section 24(b) of the IT Act for claiming tax benefit on interest component of the housing loan.

Purpose of housing loan - Home purchase / construction vs.

Home improvement Deduction under section 80C for principal portion of the housing loan EMI is not allowed if the home loan borrowing is for the purpose of reconstruction, renewal or repair of house property. Put simply, tax benefit under section 80C is only allowed for buying or constructing a new home. In contrast, deduction for Interest is allowed under section 24(b) even for the loan taken for the purpose of repair, renewal or reconstruction of existing house property but subject to the limit of Rs 30,000 in case of self-occupied house property. In case of let out house property, actual interest is allowed without any ceiling.

Payment Basis - Due Basis vs. Cash Basis

Tax benefit u/s 80C can be claimed only when the actual payment is made. Interest deduction u/s 24(b), on the other hand, is allowed on accrual or due basis. Put simply, unlike principal portion, interest deduction can be claimed even if not paid.

[Source: http://ezinearticles.com/?Tax-Benefits-Associated-With-Housing-Loans&id=6743691]

Some Things to Note When Making Housing Loan Comparison

There are numerous forms of housing loan packages available in the market. When you make housing loan comparison, it is imperative that a fair comparison is made. Being negligent to this can result in comparing mortgages that does not make sense. Sort of like comparing an apple to an orange.

For example, it cannot be realistic comparing a 15 year mortgage to a 30 year mortgage. It also does not make sense to compare housing loans with fixed interest rate to those with floating interest rates. Make comparison between different mortgage lenders with near similar structure on lock-in period and interest rates. This can also vary especially if the mortgage lender is one that is willing to be flexible on their housing loan packages. You might even get into a situation where you have to choose between favorable prepayment penalties and favorable interest rates and vice-versa.

Adding up the total fees and charges at closing will give you a good picture of which offers are the most attractive on signing up. There can be a varying number of charges and fees carrying different labels. Mortgage lenders may treat these fees differently. One may give subsidies but charge higher processing fees. Another may waive processing fees provided you take up their in-house home insurance package. So it is best that you figure out these details on closing costs before making your choice on an offer. Add up all the fees involved to make a fair and proper housing loan comparison.

Note that lower interest rates will not necessarily mean a better deal for you. Look carefully into the terms of the deal. It can be low rate for only an initial first year of the loan, and much higher rates after that. Remember to question the details of closing costs before giving your commitment to accept a House Loan offer from a lender.

When you are fully aware that you are going to switch mortgage lenders after the lock-in period, you should take greater care in your offer selection. This is because the redemption penalty will be of meticulous concern to you. However, if you are willing to pay higher interest rates and obtain favorable penalty terms, tell your mortgage lender. You wouldn't know how flexible they can be if you don't ask.

For example, when you are looking at housing loan offers with a floating rate in Singapore, it is most commonly bench-marked to the publicly available Singapore Interbank Offered Rate (SIBOR) or Swap Offered Rate (SOR). A margin is added on top of the available rates, and that becomes your interest rate.

Generally, SIBOR is more stable while the SOR is more volatile in fluctuation. So an individual with an appetite for calculated risk may choose a housing loan bench-marked to the SOR when it is low. Do ask questions on current outlooks when deciding offers between these 2 benchmark rates. Because rates can change daily, the lenders are in the best position to provide you timely information on interest rates.

The most widespread deciding factor that influences an individual on a housing loan decision is the loan-to-value ( LTV ). The LTV is the amount that a mortgage lender is willing to offer the borrower for the housing loan. The common practice is to finance an amount based on the market valuation or purchase price of the property in question, whichever is lower. It simply means that a house has a current market valuation of $ 400,000 and you bought it for $500,000, the mortgage lender will only be comfortable to finance a portion of the valuation price at the lower value of the 2 - $400,000.

Don't assume that a lender will finance 80% of a property purchase just because you heard of it from a friend. Be careful on this and check with a lender on how much they are willing to finance. This is because different properties in different categories can be treated differently by a lender. They may be willing to finance 80% of properties in category A while only 60% of properties deemed to be in category B. whereas; a different lender may have an internal policy that is the other way around.

Different mortgage lenders can have differing lending policies. Factors like proposed redevelopment, location, etc, can be determining factors. So be careful when comparing housing loans. Decisions from one lender do not necessarily serve as a reflection of the whole market.

[Source: http://ezinearticles.com/?Some-Things-To-Note-When-Making-Housing-Loan-Comparison&id=5654350]

Calculate your housing needs easily with home loan calculators

If you can dream about owning a house, you can surely own it! With the right kind of knowledge about the home loan product it can be quite fun and exciting experience. Today, there are lots of government and private sector banks & finance firms that offers customized forms of home loans to their clients. People can approach these banks and private financial firms to get the best deals on home loan interest rates and other processing charges. It is obvious that owning a house means lots of pros and cons associated with it before finalizing a bank. When you visit a bank or an agent they will ask you to purchase a home loan,  with protection cover or other protection commodities along with housing finance. They will assure you that it will be added to your loan amount or at times an individual is completely clueless on how much loan amount he or she needs on the grounds of place for living, income source, building or society requirements, interest rate applicable, EMI to pay, etc. They feel like lost in a sea of confusion without the right form of knowledge. Relax! Finding the right home loan amount and understanding various jargons & terms associated with it is quite easy with the help of home loan EMI calculators offered by banks & firms online. Here are some tips that will help you find the right home loan in an easy manner:

Today, India’s leading private sector banks & firms are offering housing finance with new structure of loans that are developed to meet the needs of house buyers from every section of the society. However, before choosing a particular loan, it is very important to have a comprehension about the most important constituent of the loan – the EMI (Equated Monthly Installment). An EMI is a certain amount of money that an individual pays to the bank as pre-decided in the terms & conditions of the loan policy towards obtaining the legal possession of the house in near future. It is paid each calendar month, to the lender, for clearing their outstanding loan.

Your home loan EMI is calculated based on three things: Enter your home loan required amount, choose an interest rate applicable by home loan provider and select the tenure you wish to repay loans. Once you enter these details your calculated EMI amount along with interest applicable will be displayed for your information.

The home loan EMI calculator helps you understand the regular EMIs applicable on your housing finance. These calculators help you cut down the hassles of usually tedious and time consuming manual calculation of EMI applicable on your home loan. It is simplified and loaded with all the essential data, including amortization details and the ability to alter components like interest rates and tenure to try other types of permutation and combinations. This will help you make the conditions of repayment feasible as per your requirements. The most important benefit is you can plan your budget well in advance and keep aside the monthly EMI amount towards your housing loan.

While using home loan EMI calculator individual should consider charges applicable like processing fees of the loan, pre-closure charges, type of interest rates (fixed or floating basis), etc. Each EMI of the loan amount pays a part of the principal that you owe to the bank along with the decided interest rate on it. Banks and financial firms, have a certain mathematical formula to calculate the EMI based on loan amount, interest applicable, your income sources and other important details.

For a given loan amount, tenure and interest rate, the EMI calculated and the amortization schedule offered by banks and private financial firms will be similar. The pattern of reduction of principal amount through payment of each EMI will follow a similar trend across all financial institutions. Also, individual should note that the initial EMIs contribute more towards payment of interest due as compared to the principal amount. As the tenure progresses, subsequent EMIs will clear off the principal amount. Thus, by paying each EMI to bank you get an inch closer towards clearing off the debt and owning your dream home forever.

Visit Here: https://www.hdfc.com/emi-calculator

Loan-requests-for-better-home-loan-rates

The first and the most important strategy to negotiate your interest rate on home loans is to constantly update yourself with what different lenders are offering.

At present, customers have a plethora of options available from banks and financial institutions with regards to home loans and their interest rates. Today, banks and financial institutions also offer flexible interest rates for different income categories. Here's a few tips to negotiate your interest rates on home loans:

Information:

The first and the most important strategy to negotiate your interest rate on home loans is to constantly update yourself with what different lenders are offering. One should check both the fixed and variable home loan rate and then compare the two against each other. Figuring out the loan eligibility on the basis of information collected from agents is another crucial pre-requisite before deciding to opt for a home loan. Such discussions also help consumers in deciding relevant issues such as type of interest rate tenure, other charges etc. Exercises like this will also protect the borrower from getting misled by lenders who often use various jargons to lure customers.

Having all the information you require can also be useful for someone who has already availed a home loan. It will help him/her learn if they are paying an extra amount and also if another bank or financial institution could provide a better rate. The facts on the rates offered by different banks and financial institutions will help the borrower discuss the situation with more authority and this may further lead to the lender agreeing to a better rate for the existing home loan. This helps as from a lender's point of view it is easier to retain an existing customer than to get a new one.

One could also opt for a balance transfer in case another bank or financial institution is providing a better rate, but such a decision should be taken only after weighing all the pros and cons. The borrower should get a clarification from the new prospective lender on all start-up fees involved with refinancing the existing home loan besides asking the existing lender to explain the costs involved in paying out the loan. The transfer process should only be initiated after there is a clear indication that the move will save money.

Credit score:

In today's time, a good credit score helps the borrower negotiate his/her loan and interest rate, processing fees, pre-payment penalty and all the other charges involved while purchasing a property. Most banks and financial institutions believe that customers with a sound credit rating are less likely to default on the loan amount. Borrowers with salary accounts or credit cards can also avail further discounts on processing fees and prepayment penalties from banks.

In case one has a poor credit score certain steps should be undertaken to help set things right. One could take start making payments, whenever due without delaying them any further, by not utilizing the maximum limit on your credit card , pay off any debt etc.

Documentation:

There is no substitute to effective documentation while availing home loans. This gives banks the confidence about the borrower's credibility and repayment capacities thus helping in securing loans. The document filing is also an important step in this process as it is highly unlikely for a bank/lender to offer a best possible quote until the documents are submitted. One must be completely honest about existing debts, credit cards, and repayment history to all lenders to give a clear idea about their existing financial position. This will also help individuals to negotiate home loans better by enhancing their credibility as banks will also check the same with the Credit Bureau about the credit worthiness of the individual.

Another important point to keep in mind before availing a home loan is approaching prospective lenders only after the property is finalized and disbursement is required in the next few days. Most lenders are interested only in disbursements and reserve their best rates only for immediate disbursement cases.

Time your loan:

Borrowers should look at timing their loans towards the end of the month or quarter for better rates. Banks and financial institutions have pre-defined sales targets for its staff towards the end of the month/quarter and may offer competitive rates to complete their targets.

One should also look at timing their loans towards the festive season as lenders tend provide incentives in terms of lower interest rates and processing fees during this period to encourage sales.

Larger customer:

Bundling loan requests with friends & relatives to offer a larger business opportunity to banks and financial institutions is another tactic one can use for negotiating home loan rates. This is possible as banks and financial institutions would be saving on their legal and technical costs relating to property title, valuations, etc.

Conclusion:

Getting a home loan is becoming a hassle free/simple procedure with financial institutions increasingly focusing on shortening the entire process. Lenders are giving applicants an option to fill the application form online besides providing on-ground assistance of home loan advisors to assist them. With the increasing competition, financial institutions may go all out to offer home loans at competitive rates and make the entire process simple, but customers should sign up for home loan emi calculator only after ensuring that they are getting the best deal from their financial institution.

Source: http://checkthis.com/emiforhomeloan

Is Your Financial Life On Track?

While we all have different goals in life, there’s one that we all share—the goal to be financially sound. All our lives, whatever we do, we do it with an aim of earning better. It becomes quite frustrating if, after that entire struggle at work and burning the midnight oil, things don’t go the way we want them to. The ultimate reason for working that hard is not merely a raise or a promotion; we do it for something more—to be financially sound. This keeps us going.

Some of the basic parameters to judge anyone financially are—their income, their spending habits, their savings and investments. If you’ve got all or most of these right, your finances are more or less on the right track.

Even if you’re not facing any financial troubles at the present, that doesn’t ensure a safe future ahead. Here are some pointers to check whether you’re doing enough to keep your financial life on track:

What does your bank balance say?

Your bank balance at the end of every month acts as a great indicator to show you how well you’ve done. Did you exhaust it all by spending on a sale or on some expensive gadget that you don’t even use? According to most financial experts, you must save at least 20 per cent of your monthly salary. If you’re unable to do that, you’re doing something wrong.

Are your resources growing?

Your resources include everything you own—your bank balance, property, cars, gold. To evaluate your financial standing, you need to evaluate the net worth of all your resources and see if there’s a positive growth. It doesn’t mean that your net worth needs to grow exponentially, but there just needs to be a positive growth curve for it. Continuous growth in your resources is a great indicator of a good financial record.

How many loans do you need to repay?

You might be earning well, but if you have a lot of loans to pay off, you need to plan your money better. First of all, you must not borrow so much. In the worst case, even if you need to borrow, you must balance it well. If you’re in need of a house, it makes sense to opt for a Home Loan. But to take a Personal Loan just to fund a dream vacation simultaneously might not be a great option. If you’re heavily dependent on loan money, you have a lot to work on!

Do you have insurance?

‘Why do I need insurance to check my financial stability?’— that’s probably what you’re thinking right now. Consider this scenario—you just saw the house of your dreams and arranged for a huge down payment for a Home Loan. But suddenly there’s a medical emergency and you have no other option but to use that down payment money to take care of the emergency. 

As you rise up to the occasion and look into the emergency as a priority, your dream to occupy that house gets postponed. Heart breaking, isn’t it? Well, you could’ve easily avoided this situation if you had taken a Health Insurance cover, right? You could’ve used the insurance money for the emergency, while your down-payment money would’ve remained untouched. Now you know why staying protected from potential external damages are essential for your financial security, don’t you?

[Source: https://blog.bankbazaar.com/is-your-financial-life-on-track/]

How to Get Pre-Approved For a Home Loan

Have you been thinking about buying a home? Which in turn has you thinking about applying for a home loan? Some of you may not know that both Marc and I used to work in the mortgage home loan industry. This experience comes in extremely handy for our real estate business because we know the back end finance component.

Marc owned a mortgage group joint venture and I worked as a loan officer for over 5 years. We have helped home owners obtain the financing they needed to buy their home. Since then lots of things have changed in the mortgage industry, but the basics remain the same.

We have built relationships with the best of the best on the mortgage loan side, you can request our complimentary referrals by sending us an email HERE and write in the subject line, help connect me with a mortgage lender.

When it comes to buying a home you have two options:

1) Pay Cash

2) Financing with a Mortgage Loan

Regardless of your financial scenario we take a consulting approach which helps us better understand your needs and match you with the appropriate vehicle to get you to your destination.

Here are some quick tips to get you prepared to speak with your mortgage loan officer:

5 Things You Need To Get an Emi for Home Loan

Proof of Income

Proof of Assets

Good Credit

Employment Verification

Documentation (Driver's license, ID, Social Security #)

Those are just the basics and speaking to a professional who specializes in mortgage loans will help go into more detail of the specific documents needed. Being pre-approved before you start house hunting is most important, when you find the home of your dreams and want to buy it a pre-approval letter is sent with your purchase offer on the home. This gives the seller assurance that you are the real deal!

Stay tuned for more of our Commitment of Service Series and don't forget you can contact us anytime for help with your San Diego real estate needs!

[Source: http://teamschuco.blogspot.in/2016/01/how-to-get-pre-approved-for-home-loan.html]

EMI for Home Loan - What Is EMI and How Is It Computed?

EMI is an oft repeated term that is associated with any loan taken. Let us understand how EMI works and what are the different aspects associated with EMI. The EMI facility helps the borrower plan his budget. The EMI is calculated taking into account the loan amount, the time frame for repaying the loan and the interest rate on the borrowed sum.

An Equated Monthly Instalment (EMI) is usually a fixed amount of money that you need to pay your bank or lender every month as repayment of a loan taken, until your loan is totally repaid. It is essentially made up of two parts, the principal amount and the interest on the principal amount, divided across each month of the loan tenure. The EMI is always paid to the bank or lender on a fixed date each month. This could be done though post-dated cheques issued in favour of the lender or by providing auto debit instructions to your bank for the same.

Here’s the formula to calculate an EMI:

Now, you might assume that the equal parts of the principal and interest are repaid to the financial institution every month. However, this not the case. During the initial years of repayment, the interest component repaid is higher while in later years, the principal component is higher. So, you cannot assume that you will have repaid half of the loan amount once half of the loan tenure is over. A more likely scenario we that you’ve reduced the total interest component that was due by a considerable amount while the principal amount remains to be paid.

Here is a simple example that explains how the repayment of your EMI reduces your loan amount during the repayment period leading up to the end of the loan tenure.

Here the loan amount is Rs. 1, 00,000, which is lent at an interest rate of 12% with a loan tenure of 12 months.

The monthly EMI is calculated at an annualized rate of 12% and amounts to Rs.8,885 per month with the total interest component amounting to Rs.6,619.

You will notice that the interest repaid decreases with each passing month while the principal repaid increases at the same time. This means that with a larger loan amount of say Rs.5 lakh and a longer tenure of 20 years, the interest component will form a greater portion of the EMI. This interest portion will reduce leading up to the loan tenure, while the reverse is true for the principal component.

Will the EMI change during the loan tenure?

There are three reasons why your EMI might change during the tenure of your loan.

§  Interest rate on your loan changes – If you have opted for a floating interest rate, the interest rate on your loan will change whenever the floating rate is reset by the lender. This, in turn, will result in a change in your EMIs. However, note that you can instruct your lender to not to change the EMI and instead request for change in the tenure of the loan.

§  You prepay the loan – In case you prepay the loan amount during the tenure of the loan, your EMI will change. This is because the principal of the loan will have gone down and the interest due will be based on this new principal. Here too, you can ask your bank to change your tenure instead of the EMI. This will help you repay the loan quickly.

§  You opt for progressive EMIs – Some lenders offer the option of repaying the loan through staggered EMIs. Here, you pay a fixed EMI for a specific number of years initially and after that term, you start paying larger EMIs. This is generally chosen by young earners who have just started their career and cannot afford to pay large EMIs initially and hope to pay larger EMIs as they grow in their profession.

At the end of the day, loans are liabilities and it is best to close them as quickly as possible, unless you are getting other benefits such as tax exemptions. It is best not to reduce your emi for home loan even if interest rates fall.

Source: https://blog.bankbazaar.com/what-is-emi-and-how-is-it-computed/

EMI for Home Loan - What Is EMI and How Is It Computed?

EMI is an oft repeated term that is associated with any loan taken. Let us understand how EMI works and what are the different aspects associated with EMI. The EMI facility helps the borrower plan his budget. The EMI is calculated taking into account the loan amount, the time frame for repaying the loan and the interest rate on the borrowed sum.

An Equated Monthly Instalment (EMI) is usually a fixed amount of money that you need to pay your bank or lender every month as repayment of a loan taken, until your loan is totally repaid. It is essentially made up of two parts, the principal amount and the interest on the principal amount, divided across each month of the loan tenure. The EMI is always paid to the bank or lender on a fixed date each month. This could be done though post-dated cheques issued in favour of the lender or by providing auto debit instructions to your bank for the same.

Here’s the formula to calculate an EMI:

Now, you might assume that the equal parts of the principal and interest are repaid to the financial institution every month. However, this not the case. During the initial years of repayment, the interest component repaid is higher while in later years, the principal component is higher. So, you cannot assume that you will have repaid half of the loan amount once half of the loan tenure is over. A more likely scenario we that you’ve reduced the total interest component that was due by a considerable amount while the principal amount remains to be paid.

Here is a simple example that explains how the repayment of your EMI reduces your loan amount during the repayment period leading up to the end of the loan tenure.

Here the loan amount is Rs. 1, 00,000, which is lent at an interest rate of 12% with a loan tenure of 12 months.

The monthly EMI is calculated at an annualized rate of 12% and amounts to Rs.8,885 per month with the total interest component amounting to Rs.6,619.

You will notice that the interest repaid decreases with each passing month while the principal repaid increases at the same time. This means that with a larger loan amount of say Rs.5 lakh and a longer tenure of 20 years, the interest component will form a greater portion of the EMI. This interest portion will reduce leading up to the loan tenure, while the reverse is true for the principal component.

Will the EMI change during the loan tenure?

There are three reasons why your EMI might change during the tenure of your loan.

§  Interest rate on your loan changes – If you have opted for a floating interest rate, the interest rate on your loan will change whenever the floating rate is reset by the lender. This, in turn, will result in a change in your EMIs. However, note that you can instruct your lender to not to change the EMI and instead request for change in the tenure of the loan.

§  You prepay the loan – In case you prepay the loan amount during the tenure of the loan, your EMI will change. This is because the principal of the loan will have gone down and the interest due will be based on this new principal. Here too, you can ask your bank to change your tenure instead of the EMI. This will help you repay the loan quickly.

§  You opt for progressive EMIs – Some lenders offer the option of repaying the loan through staggered EMIs. Here, you pay a fixed EMI for a specific number of years initially and after that term, you start paying larger EMIs. This is generally chosen by young earners who have just started their career and cannot afford to pay large EMIs initially and hope to pay larger EMIs as they grow in their profession.

At the end of the day, loans are liabilities and it is best to close them as quickly as possible, unless you are getting other benefits such as tax exemptions. It is best not to reduce your emi for home loan even if interest rates fall.

Source: https://blog.bankbazaar.com/what-is-emi-and-how-is-it-computed/

Problems with Home loan

With home loans come great advantages and problems altogether. RBI has recently taken a lot of measures to protect customers with home loans and get them better deals also. But, here are a few areas where RBI can look into as a part of its consumer protection initiative:

Banks have an interest in the property mortgaged with them and they need to ensure that it is protected against any eventuality. At the same time banks also gain by selling insurance policies.  But what need to be insured are the cost of construction and not the cost of land. Because, It is therefore not clear whether the bank’s insurance policy will pay a claim when the housing society is also making a claim for the property damage.

Most home loan borrowers focus on the interest rate at the time of availing home loans. But floating rates are dynamic and vary from time to time. The borrower is not aware of this because while rates vary, the equated monthly installment or EMI does not. Banks hardly change the tenure of the loan.   Very rarely does a bank communicate to the borrower about changes in interest rates.

In Maharashtra the government had made it compulsory for all mortgage interests to be registered. This was aimed at preventing fraudulent sale of the property even if the loan is outstanding.  Although the law actually protects the bank’s interest lenders. Rather than to facilitate smooth registration by the institution, borrowers are forced to approach agents and spend a few thousands to complete this process.

Lenders often poach from home loan borrowers of other institutions through Home Loan Emi Calculator. But when it comes to their existing customer they do not offer them the benefit of new rates.  If there is a special scheme running in the bank, existing borrowers are not informed of it. Also banks charge customers a processing fee even when their loan is refinanced within by their own bank but under a different scheme.

Some banks have resorted to complicating the pricing of home loans introducing interest free years in middle of the tenure of the loan. Innovation in financial products is good only as long as they do not obscure pricing. Borrowers need to have the opportunity to compare the cost of one home loan against another.  One way to make the pricing transparent is to disclose the cost in the form of annualized yield to the lender based on prevailing rates.

[Source: http://loanwalle.com/blog/problems-with-home-loan/]