February 23, 2024

Business Bib

Business & Finance Blog

A home loan for a home of your own

4 min read

Asha and Ravi have been paying a huge sum as rent for the last five years. Ramesh has a plot of land in the city, but no funds to build a house, so he lives as a paying guest, sharing his room with two other people. Nirmal’s house is too small, especially now that his kids are growing up, they need a separate room of their own. Meenal’s ancestral house immediately needs some repair work as it’s almost in shambles.

Do you know what all these people have in common? All these people are waiting for some miracle to happen so that they get some huge cash in their hands to fulfil their dreams. But why do you need a miracle when there is a far more practical way to make your dreams a reality. Just take a home loan.

A solution to your home needs

Home loans give you the freedom to live life on your own terms without making any kind of compromise. So, with a home loan, Asha and Ravi can buy a house of their own, and instead of paying rent to someone else every month, they can use the money to pay the home loan EMI.

With a home loan, Ramesh can build a house of his own, and he wouldn’t have to share his room with strangers any more. Nirmal can add a new built-up area to his existing house and create a separate room for his kids with a home loan. And Meenal can use a home loan to renovate her old ancestral house and make the necessary repairs. As you can see, all the above problems can be solved within a wink of an eye by opting for a home loan.

Home loans are nothing but loans given by banks and financial institutions like Tata Capital to people who want to construct their own house, buy a readymade house, do repair or renovation work or expand their existing house.

You can pay off the home loan over easy monthly instalments. It makes sense to opt for a home loan because it is always nice to have your own space than live in a rented accommodation and keep paying money to the landlord. You can save that rent and pay it as a home loan EMI.

For all you know, if you take home loans from reputed financial institutions such as Tata Capital that offer very affordable home loan interest rates, your EMI could be less than or equal to the amount of rent you are actually paying. Worse comes worse, you might have to chip in a little over what you pay as rent. But think about the freedom that you will have in your own house. You will obviously have much more liberty in your own home compared to a rented accommodation. Besides, if you can make some small adjustments to your financial planning, and get a place that you can call your own, then why even stay in a rented place or a smaller place or even a dilapidated house? Everyone deserves to have a good life, and so do you.

Repaying is as easy as borrowing

If you are worried about the home loan EMI, then just there is nothing to worry about. It is not as big a monster as it is perceived to be. These days institutions such as Tata Capital are offering home loans at low home loan interest rates, which has made the whole affair simpler and affordable

So, if you thought that only the rich and the highly-affluent people can afford to pay home loan EMIs, then you are mistaken. Home loans are for everyone.

Wondering what are the ongoing home loan interest rates, and whether it is within your affordability? Well, currently, the home loan interest rates are different for different classes of borrowers. Here’s the real deal:

  • For salaried and self-employed professionals, the lowest home loan interest rate at institutions such as Tata Capital is 9.05% for a loan amount up to Rs 30 lakh. If the loan amount is higher than Rs 30 lakh, then the applicable rate of interest would be 9.20%.

  • For self-employed non-professionals, the lowest home loan interest rate is 9.20% for a home loan amount of Rs 30 lakh. It is 9.45% if the home loan amount is higher than Rs 30 lakh.

So, you can see, home loans are not a demon. They are pretty affordable. You just have to plan and prioritise your expenses. Assess your cash flow, then deduct all your expenses, including EMIs for any other loans that you have taken, deduct your savings and investment, and now see, how much you are still able to save.

If you feel that you are not able to save much, you can plan to cut down on a few expenses. Instead, you could think of it as investing in a home loan, and get to stay at your own house like a king. There is no greater satisfaction in life than owning your own home, after all.