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Loans

How to choose the right home loan?

Understanding Home Loans

Buying a home is one of the biggest financial decisions you'll ever make. Choosing the right home loan is just as important as choosing the right property.

1. Interest Rates: Fixed vs Floating

  • Fixed Rate: The interest rate remains constant for a specific period or the entire tenure. Good if you expect rates to rise.
  • Floating Rate: The rate changes with market conditions (Repo Rate). Generally cheaper than fixed rates.

2. Loan-to-Value (LTV) Ratio

Banks typically fund 75-90% of the property value. You need to arrange the rest as a down payment.

3. Hidden Charges

Always check for:

  • Processing fees
  • Prepayment penalties (usually nil for floating rate loans)
  • Legal and technical verification charges

Conclusion

Compare offers from at least 3 banks before deciding. Use our EMI Calculator to plan your budget.