Owning a home not only puts a roof over your head but also creates an asset and a sense of security. You can design your home as per your choice & requirements, making it a safe haven for your family.

Thanks to home loans, now owning a home has become simpler and easier. Home loans are used to finance the purchase of a house, whether it is ready to move in or under construction. The repayment tenure is long, and the interest rates are also low, so the loan repayment becomes easy.

So, if you are dreaming of owning a home, make it a reality with Bandhan Bank home loan. However, before you apply for the loan, here is a 7-point checklist to consider-

1. Check your eligibility

Home loans have specified eligibility criteria that borrowers must fulfil to become eligible for the loan. So, before you apply, check the eligibility criteria of the applicant. The criteria include requirements about your age, occupation, monthly income, existing debts, and credit score. Your credit bureau score is an important parameter that determines loan sanction amount. To sanction the loan, lenders usually require a good credit score of 700 or above. See if your credit score is within the required limit; you can get your home loan sanctioned.

2. Check the LTV ratio

Though home loans give you funds for your home, they do not provide 100% finance. The LTV (Loan to Value) ratio determines the loan that can be availed based on the cost of the property. If the ratio is 70%, it means the bank would give a loan for 70% of the property's cost while you have to pay 30% of the cost yourself. So, check the LTV ratio to find out the down payment needed for the loan. 

3. Know the loan charges

Home loans have different types of charges associated with them, the processing fee being one of them. Check the processing fee and other charges of the loan. Pick a loan with a low charge structure so that it is cost-effective.

4. Check the interest rate

Home loans might charge interest on a fixed or a floating basis. Under fixed-rate home loans, the interest rate does not change during the loan tenure. On the other hand, the interest rate does not remain fixed under floating rate home loans. It changes during the repayment tenure if the bank changes the rates on home loans. If you are expecting home loan interest rates to fall in future, opt for floating-rate loans. Alternatively, if you believe that interest rates might rise, you might choose the fixed-rate loan and lock in low-interest rates. 

5. Pre-calculate the EMI

Lenders offer home loan EMI calculators that help you check the EMI payable after entering the loan amount, interest rate, and repayment tenure. By checking the EMI, you can ascertain if the home loan would be affordable or not. If the calculated EMI is high, you can reduce the loan amount and/or increase the repayment tenure to reduce it. On the other hand, if you can afford a high EMI than the calculated amount, you can increase the loan amount and/or reduce the tenure. Therefore, the home loan EMI calculator helps you find the most affordable EMI for the loan. So, pre-calculate the EMI using the calculator before applying for the loan.

6. Know the required documents

You have to submit a set of documents along with the home loan application. The lender uses these documents to ascertain your eligibility and to verify your identity and income. The property documents are also required as they allow the lender to verify and authenticate the property financed by the loan. So, find out the list of documents required for the loan. Keep all the documents handy so that the bank/lender easily processes your loan application.

7. Compare and apply

Lastly, always compare the loan options before you pick one. There are multiple lenders in the home loan market, and each lender has a different loan offer. Check the loan amount, charges, LTV ratio, and interest rate offered by different lenders. Shop around and choose a lender that offers the most suitable home loan and that too at low-interest rates. This would help you get the best deal.

Availing of a home loan is easy. There are various lenders in the market offering a loan for your home. It is suggested that you do your research well by taking sufficient time and effort so that you do not miss the best opportunity. 

Good research helps in getting the most suitable home loan that is affordable and helps you buy your dream home. Moreover, the above checklist can be your ready reckoner when you research the loan options available in the market. Bandhan Bank offers different kinds of home loans that can finance all your home-related needs. So, keep the checklist handy and tick off all the points before you apply for a home loan.