Visioning yourself in a dream house can be a reality. Even when your pocket is not completely up for it, it’s still on the list.
Well, you don’t just stand up and went to get a home loan out of the blue. You must research first! But, be aware of the revolving misconceptions and myths about home loans. There are questions to ask before getting a home loan include reasoning’s on all the myths that have been travelling for far too long.
Home loan applicants often fall prey to 4 most popular myths that should be looked into!
1. A high credit score is guaranteed for loan approval
The creditworthiness!
By checking the credit score of the applicant for home loan plays a major role. Well, it does. But, calling it a guaranteed approval is wrong.
Other major factors also play a role ina home loan application to be approved. Like,
- Age
- Employer profile
- Income
- EMI commitments
- Location
- Property type
And some others as well. Each of the factors plays a major role. It’s not just a good credit score.
2. Shorter tenure is good
Do you think shorter home loan tenure have lower interest cost as compared to long tenure?
Assuming that the interest rate would be equal of both tenures, is a huge misconception.
Shorter loans tenure attracts more EMI visions. It can badly affect your financial health. Mostly it doesn’t leave much chance or room for other investments or plans. You are completely bond to it until or unless the tenure period is over.
3. A loan with the lowest interest rate works better
It is highly assumed that the lowest interest rates are the best deal for home loans.
It-Is-Not!
The interest rate is just one of the other factors are considered. It doesn’t solely depend on it while choosing a lender. Sometimes you meet the lower interest rate because the tenure period is longer than usual.Even lenders can charge you high processing fee when offering the lowest interest rate on home loans. Don’t be solely dependent on it.
4. Banks do not negotiate
Banks may also extend discounts to keep a good customer just like any other provider.
The discounts are often offered by banks on the charges of your interest rate in case of you being a good customer in their perception. So one should not hesitate in asking for it!