Housing Finance is money given to people to buy a home or apartment or acquire land and construct it. The financing obtained for home or apartment improvements is also included in this category. The lender has a hypothecated mortgage on the property, which serves as security until the loan is repaid in monthly instalments.
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Different Types of Home Loans
People apply for housing finance for a variety of reasons in addition to purchasing a home. The following list includes a few of the most common home loan kinds.
Loan For Purchase Of Land
With a loan for land, buyers can put money aside and build a home whenever their finances allow them to, or they can keep the land as an investment for the future.
A Loan To Buy A Home
This is one of the best forms of mortgages to employ when buying a home, whether it be a condo or an independent house, new or used. This loan has a fixed or adjustable interest rate.
Loan For House Construction
This kind of home loan is an option for those who intend to build a house on land they own. This loan is ideal for those who want to construct a home as per their wishes.
Loan For Home Improvement
Another well-liked option among several housing finance options is for improvements like changing the design of the current property or additions like building a new balcony, floor, or room.
Property Conversion Loan
People who have used a home loan to buy a house but want to move to a new home can effortlessly and hassle-free transfer their present loan to the new home.
Transfer Of Balance House Loan
Transferring a loan balance from one bank to another is one of the most acceptable housing loan options because of factors including lower interest rates, superior services, and more.
NRI Housing Loan
This house loan is intended to aid non-resident Indians interested in purchasing a home in India. This loan has slightly different paperwork requirements and procedures than the others.
The finest kind of mortgage provides money for a new home while the borrower searches for a buyer for their present one to repay the debt. The property is mortgaged as collateral in this method.
Stamp Duty Loan
It’s a rare kind of financing that pays the stamp duty fees assessed to the buyer when they purchase a home.
What Is A Home Mortgage Loan?
In contrast to a loan for acquiring a piece of commercial or industrial property, a house mortgage loan is provided by a bank, mortgage company, or other financial institution to purchase a residence—a primary residence, a secondary residence, or an investment housing. In a home mortgage loan, the property owner transfers the title to the lender, understanding that the title would be returned to the owner after all loan obligations, including the last payment, have been fulfilled.
Types Of Mortgages
There are many types of mortgages, including:
In this, the borrower mortgages a previously owned property to obtain funding for a new one. Here, the lender has the authority to sell the property if repayment is not made on time.
The plan whereby the property is given to the lender, who will be able to rent it out or profit from it without placing the borrower personally on the hook.
The arrangement under which the borrower must make regular payments to the lender to maintain possession of the property until the debt is fully repaid.
Conditional Sale Mortgage
The loaner’s plan to sell the property to the lender is subject to stipulations if they default on payment but is nullified upon timely repayment.
Title Deed Deposit
The process wherein the borrower gives the lender a copy of the property’s title deed to mortgage the property.
According to Indian law, Section 58G of the Transfer of Property Act, 1882 defines the mortgage in this case.
What Benefits Do Homebuyers Seek?
The advantages offered by various home mortgage loans are:
- Low Borrowing Cost
- Early Ownership
- Enhanced Loan Eligibility
When you have limited funds, purchasing a new home can be frightening. Kotak Mahindra Bank offers you the option of determining your loan eligibility online using a housing loan calculator to make the loan application process as easy and successful as possible. You can use these calculators to determine your eligibility and EMI before applying for a home loan with your chosen lender.