Choose Your Home Loan Tenure
Home loan is something that requires a lot of planning. Among the many questions that pop up in your head when you think of a housing finance, a common question is the tenure of your loan. Deciding the tenure for your loan is the most critical decision. As because on the basis of this decision, you will be carrying your liability till the planned agreed tenure period. And, longer the loan tenure will be resulting in higher loan amount. Did you calculate it yet?
Many people usually postpone this purchase of a house as because they feel their current income is not enough to get a loan. If you are one of those, then, you should try to calculate your eligibility with the maximum loan tenure in the first place. You may be surprised to find that your dream home can be purchased easily. Just few calculations are required to know so. And, if you are not comfortable with short term loan, then you can choose a longer tenure for your housing finance.
But, you should remember that the maximum tenure is also restricted by your age as well. Thus, a 45-year-old person cannot get a 20-year loan as he will be long past retirement by then. So, such individual can avail home loans India for at least 15 years. If the individual is self-employed, then, the bank may also consider a 20-year loan as the retirement age for a self-employed person is assumed at 65 by most of the banks.
Many people in order to pay off the home loan as quickly as possible, make this mistake and take on a bigger than warranted EMI burden with restricted tenure for the loan. Even if the loan eligibility is not a constraint, still one should go for the longest tenure possible with a no prepayment penalty option. With this approach, you retain the flexibility of low equated monthly installments (EMIs) and at the same time you can also opt to pre-pay your outstanding loan amount whenever you have surplus funds.
