3 Tips on Getting a Good Home Loan in Mumbai

Especially compared to the other Indian metros in India, Mumbai’s real estate prices are quite steep.

If you want to buy a home in the city, you’ll need to be willing to shell out a few crores. Given the average salary, you’ll definitely need external financing—in the form of Home Loan—to buy a house in Mumbai.

You can approach banks and housing finance companies to get one. A Home Loan keeps your liquidity intact, and offers tax benefits as well. In fact, it is one of the most widely used tax deductions, especially among salaried employees.

Take a look at these guidelines; they will help you find and pick the best deal on your Home Loan.

Compare Interest Rates

A sizeable heft of your EMI goes towards interest. When you’re taking a huge loan to finance your home purchase in Mumbai, you get to pick from Home Loan at varying interest rates.

Home Loan interest rates in Mumbai vary across banks and NBFCs. The interest rate on Home Loans charged by banks is generally lower than that charged by NBFCs. Comparing interest rates online helps you take informed decision on the choice of lender.

Deciding on whether you go for a fixed rate or floating rate loan also has an impact. Interest cycles fluctuate, and a floating rate loan helps to save substantially on your EMI when the interest rates are falling. With the RBI mandating that lending rates by banks should be based on MCLR (Marginal cost of funds Lending Rate) with respect to loans taken after 1st April 2016, interest rates on Home Loans are expected to fall. This will be offering a respite to Home Loan borrowers.

Rope in a Co-borrower

Buying a home is Mumbai calls for a greater principal on your Home Loan. The bank approves the loan based on your earning and repayment capacity. To enhance your Home Loan eligibility limit, apply for a joint loan with a co-borrower. The co-borrower can be your spouse or your parent, or your earning children.

Maintain a Good Credit Score

CIBIL maintains a large database of creditworthiness, based on borrowers’ payment history and borrowings. If you’ve honored all your loan commitments on time—and thereby have a high credit score—you can get favorable credit terms. Banks, when scrutinizing your Home Loan application, analyse your credit history.

In today’s digital age, you can apply for Home Loans online. Faster approvals help you buy the home of your choice when it is out for sale. Apply for a Home Loan and become a proud homeowner in India’s financial capital today.

Arwind Sharma is a financial advisor with an experience of more than 7 years. He has worked for topmost financial firms in India and has been a visiting faculty at many reputed institutes in India.