Property rates in multiple Indian cities spiked during the July-September period of 2021. Low- interest rates and high demand are two basic reasons behind this event. The prices were further predicted to rise after the discount laced festive season ends. This can lead to excess monetary pressure on home-buyers. But fret not. You can apply for home loan which is tailor- made with minimal documentation with a tenure of up to 30 years. You do not need to dig into your savings or break your FD. But it is necessary to plan your EMIs well.
This can help you become a debt-free owner of a house. Take a look at how to save extra money to be able to repay the amount with defaulting or penalties.
1. Build a Separate Fund
Having a home loan pot will keep you from being cash-starved. Start saving right away if you are planning to buy a property 3-5 years down the line. Begin small and stash extra income towards this fund. Let the wealth grow consistently to see a significant amount within a stipulated timeframe. It will help you pay off the home loan faster without missing deadlines. Head over to your bank’s official website to get an idea of the home loan interest rates and EMI to plan better.
2. Take a Personal Loan
A personal loan is an easy option when it comes to debt clearance. Work with leading Indian banks that will offer flexible tenures with funds up to ₹40 lakhs. This will help you gather enough money to pay off the home loan. You can also consider pre-payment if possible. Check with your bank to see if there are extra charges for the same. Pick a longer tenure for your personal loan to ensure pocket-friendly EMIs to reduce the burden.
3. Invest Your Money
Consider an FD or a mutual fund beforehand. These are useful even if your home purchase plan is just a year away. Lockin a substantial amount and receive the desired funds at maturity. This money can tackle the home repayment without running into debt.
4. Create a Realistic Budget
Incorporate the 50/30/20 principle. It means 50 % will go towards needs, 30% towards wants and 20% towards savings. This money management technique can keep you from overspending. Further:
- Keep a track of the cash outflow for rent, groceries, luxuries and basic utilities.
- Cut down costs wherever possible.
- Try not to splurge unnecessarily on online shopping websites.
- Make the most of discount codes and coupons to save money.
All of these combined can help you save extra bucks. Use it to clear your EMIs hassle-free. Analyse your net income and current spending and act accordingly.
5. Negotiate for Interest Rates
A trusted bank might lower the home loan interest rates under specific circumstances. For example, a great credit score, loyal customer and an impressive loan repayment history are basic factors that a lender can check to reconsider the rates. You can save significant amount with the lowest home loan interest rate and use the same to stir clear of your EMI.
Putting these smart tips into action can keep you from postponing the home buying plan. Neither do you have to borrow last minute from friends and family. But do keep the processing fees in mind for better financial preparation.