What makes the housing loans the most taken ones?

Housing loans are something which actually makes sense when you take up a loan. It is where the lender will take your asset or property in the first place, analyze it and then give out the money based on the value of the asset. Generally, the value of assets and properties will be high (real estate in Hyderabad is actually booming) so, obviously if the lender has to give money based on the value of the asset, then you could have large borrowings from this type of loan. They are the types of loans that can be used for purchasing the house and also property. But remember that it can be taken only for commercial and residential purposes, and not for agriculture lands or properties.

These loan types are the one which actually fulfills everyone dreams of having their own house. You might be saving up money to get a house for yourself but putting out lakhs and crores of rupees from savings is next to impossible. That is when these loans will come into the picture. By availing this loan, you can then pay smaller amounts of money as EMI to the lender. This is something easier than saving money and putting everything at once.

Let us look at the features of these home loans

1. We will see the first feature that holds on to this loan. This loan is secured against a property, which means, the asset has to be put as surety with the lender. After putting, the lender will then analyze the property and then sanction the loan based on the value of the asset. Higher the value of the asset, the higher will be the loan worth. The asset which is pledged will be on your name and only if your default the payment, the lender will have the right to take legal action.
2. You have to know that home loans are not just for buying homes. They are also used for purchasing second-hand houses, plots, any improvements to the house. There might come a time where the house requires to be renovated because of the leakages or due to the time period, that is when this loan will come.
3. Under the income tax act, if you have taken home loans from a lender valued up to 45 lakhs, then you could gain a tax deduction of up to 1.5 lakh to 3 lakhs. So, these loans are actually saving up a lot of money and there is no requirement for spending in so much amount on the taxes. The borrower should remember that the property taken must not be sold within 5 years. If this is done, then the tax deduction will add back to the income again.
4. The tenure period for this loan type is a longer-term period compared to other loans. It also depends on other eligibility factors like income status, credit score, etc. If the credit score is less, then the lender will not take up the risk to give you a loan, but they might consider giving because you will put your property as surety with them.

Hello, I am Alvina working as a content writer in Hyderabad.