People need finance for a number of reasons, to meet business expenses, pay for medical bills, for education etc. All these expenses require a large amount of money and majority of the people don’t have sufficient savings to meet these expenses. In such circumstances, it is best to avail credit or loan facility. While you have the option to avail personal loan, it is best advised to opt for a mortgage loan. If you own any assets like residential property, you can pledge it against the loan.
Loan is a big financial responsibility and as a borrower you would definitely want to save on your loan deal. Even a small amount of saving would have a huge impact on your credit. Below mentioned are a few proven ways to save money on mortgage loan.
Improve your credit score:
The credit rating of the borrower is one of the important factors that the housing finance companies consider while approving the loan application. The higher your credit score, the better your chances of qualifying for a loan with lower interest rate. Before you apply for home loan or loan against property improve your credit rating. Try to pay off your outstanding dues and reduce the credit card usage.
Don’t apply for bigger loan than you need
This is the easiest way to save on your mortgage loan. The lesser the principal amount, the easier it would be for you to repay. Additionally, having a extra bedroom or luxurious amenities like a swimming pool or sauna would not only increase the loan cost but also it would increase the home maintenance cost.
Opt for pre-approved project
When you apply for home loan it is best advised to go pre-approved projects as it would help you get great savings on your loan deal. You can bargain on your deal with the property owner as well as the real estate agent and lower the property price. Make sure that you have a good bargaining strategy in place.
Make a higher down payment
The larger the amount you pay upfront for the property the lesser would be the loan principal amount. The smaller the loan, the cheaper it is. Majority of the housing finance companies require you to pay at least 20% of the property price upfront, however, if you can afford it, do make a higher down payment.
Have a repayment strategy in place
Some people save some money every month to make 13th installment payment for their home loan, while some others pay more money in their monthly installment. No mater, the kind of strategy you adopt, the focus must on repaying the loan as soon as you can. This will help you save on your interest payment.
You can all the above mentioned tips together to increase savings on your mortgage loan. If you are availing home loans or mortgage loan from Indiabulls Housing Finance ltd, the affordable interest rates and flexible repayment options makes it easier for the borrower to repay the loan.
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