In the views of Indian customers and retailers alike, the holiday months are a time of happiness and joy. People buy new products or make investments in the hope that starting them on an auspicious date will bring them success.
Buying a house is another such decision. Because the majority of people rely on house loans to purchase a home, banks and non-banking financing firms (NBFCs) provide reduced offers, processing fee exemptions, or special repayment programs to entice purchasers.
While a lender’s goal with such offers is to encourage sales, house buyers can take advantage of the potential to save money on a loan. Because these are limited-time incentives, here’s what you need to know as a homebuyer to take advantage of them.
Types Of Offers
- Reduced Interest Rates: During the holiday season, several lenders cut their loan interest rates by 0.5% to 1%. A reduction in interest rates might help you repay your loan faster and save money on the repayment amount.
- Waiver Of Processing Charge: Because the processing price is not included in the loan amount, a lender might partially or entirely waive the processing fee.
- Waiver Of Prepayment Penalties: Lenders impose prepayment penalties if you repay your home loan earlier than the initial term. During the holiday season, a lender may decide to entirely remove home loan pre-payment costs to encourage clients to pay down their outstanding balances.
- Waiving EMI: Some banks would also reduce the number of equated monthly payments. However, in this case, you are not permitted to repay the loan early.
How Can A Lower Interest Rate Assist A Home Loan Borrower?
If you take advantage of the lower interest rate offer over the holiday season, you can significantly cut your payback amount.
How Processing Fee Discounts Help You Save Money?
The majority of the major banks and NBFCs keep the house loan processing cost between 0.5% and 1% plus taxes. The processing charge, on the other hand, has a cap and can go up to a set maximum.
The lender may also charge the borrower a legal and technical verification fee. If a lender waives these costs over the holiday season, you can save money and use it to pay off your loan sooner. Before extending your home loan application, do your homework on the lending rates, processing costs, loan type (floating or fixed), and early repayment penalties given by various lenders. This will assist you in negotiating the best offer.