The year-on-year growth of the RBI’s All India Home Price Index (HPI) has increased by 4.57% to 303.9 as of March this year against 290.6 in March last year. This is indicating that the price of properties is rising. In this situation, opting for the festive home loan interest rate offered by various financial institutions can be profitable for prospective borrowers.
About the festive season offer
As a special deal, several financial institutions are offering a festive Home Loan interest rate for their prospective borrowers, which is as low as 8.45%. This offer is available for salaried as well as self-employed individuals.
However, in the case of self-employed individuals, the rate of interest might differ slightly. These are much less than the current interest rate on Home Loan. This concession is applicable for the whole festive season including Navaratri, dussehra and valid till the Diwali festivities of 2023.
However, to be applicable for this festive Home Loan interest rate, applicants need to have a good credit score. Customers can get a higher loan amount depending on their eligibility criteria.
Further, customers can choose a long home loan tenor to pay back at their pace at their convenience. Apart from that, Home Loan borrowers can customise their repayment tenor and pay only a part of their EMI to begin with. The loan will be approved within a few hours of applying for it.
Additionally, many financial institutions offer online account management options which customers can use to access their loan details from the comforts of their homes. Online tools like EMI calculator and eligibility calculator are also available. These tools will help prospective borrowers decide the loan amount as per their repayment capacity and plan their finances accordingly.
How does the festive season impact Home Loan interest rates?
Financial institutions show a distinct preference for offering Home Loans to their customers. This is because housing loans have a relatively lower risk of default and availability of strong collaterals. On the other hand, unsecured loans like personal loans come with the possibility of loan default, which is a major risk factor.
As festivals are a time of celebration for people in India, financial institutions tend to offer attractive home loan offers to their customers to tap into the potential market. India’s real estate is ripe at the moment, and financial institutions are aware that most people consider the festive season an auspicious time for investing.
This is why they tend to come up with interesting offers that potential homeowners might find appealing.
For long-standing customers, banks and financial institutions offer pre-approved loans. By applying for home loan which is pre-approved, customers get faster loan disbursal. Prospective borrowers can check whether they are eligible for pre-approved loans by visiting the website of their preferred lender.
Eligibility criteria for availing festive home loan interest rate
To make the most of the home loan festival offers 2023, customers need to avail a Home Loan till the offers are valid. However, for this, applicants need to meet certain eligibility criteria for home loan. Here is the eligibility criteria that prospective borrowers need to fulfil:
- Nationality
In order to be eligible for festive home loan interest rate, applicants can be a resident Indian as well as NRI.
- Age
As per most financial institutions, applicants need to be within the general age limit of 23 to 75 years to be eligible for their home loan. The upper age limit is taken into consideration based on the maturity date of the loan. However, the upper age limit might change depending on the property that the applicant chooses.
- Employment
The festive home loan interest rate is applicable for salaried individuals who have a minimum of 3 years of work experience. This work experience will only be taken into consideration if the applicant is working in a public sector, private sector or multi-national company. For self-employed individuals, the business operations should be of around 5 years.
Documents required to avail of the festive home loan interest rate
Here is a checklist of all the documents that applicants need to keep in handy to complete the Home Loan application process:
- KYC documents like voter ID, passport, Aadhaar card, driving license and recent photographs.
- Mandatory documents such as PAN card and Form 60.
- Proof of income like 3 month’s salary slips and statement of primary account for the last 6 months.
- Property-related documents like allotment letters, title deeds and property tax receipts.
Apart from these documents, lenders may ask for additional ones at the time of Home Loan application.
Steps to apply for a Home Loan from most financial institutions
Here is a step-by-step guide for all those who are planning to apply for a Home Loan from major financial institutions:
Step 1: Visit the official website of the preferred financial institution.
Step 2: Navigate to the Home Loan application form.
Step 3: Fill up the form carefully and provide all the requisite data such as name, mobile number, income details, employment type, area PIN code and specify Home Loan amount.
Step 4: Enter the OTP, complete the application form and submit it.
It is wise to maintain a good credit score to be eligible for the festive home loan interest rate. In case a customer is not eligible, they can make use of a co-applicant. If the co-applicant meets the eligibility criteria, then the loan will be approved. The co-applicant can be a close relative; however, the co-applicant does not necessarily have to co-own the property.