Floating or Fixed which is the best to Opt?

 

It’s been a big myth to customers in opting the interest rate type while going for a Home Loan. Customer seeks their friends, colleagues and relatives advice that already availed a Home Loan. But still it’s been a puzzle to most of the customers how to opt and what to opt when it comes to the home loan interest rates. A little bit of understanding of the two banking terms eases the process of interest rate selection and which gives the best possible returns on the Home Loan over the period or repayment tenure.

All the home loan products are pre packed with two types of rate of interest i.e Fixed and Floating.  Fixed rate of interest is fixed for a limited period of time over the loan even if there are any fluctuations in the rates in the market. Banks will not increase or decrease the rate charged on the loan which is fixed at the time of availing the loan even if the rates comes down or goes up. Banks charge a min of 1% higher rate compared to the current prevailing rate to the customer who opts for the Fixed Rate of Interest. Post the term of Fixed the interest rate will be the rate charged on fresh loans at that time.

The Floating Rate of Interest is based on Base Rate and BPLR rates and charged according to the loan applied slabs. The floating rate can be increased or decreased if there are any fluctuations in the market. Banks revise the rates on quarterly basis on the loan amount and inform the customer about the revision of interest. If the rate is increased then accordingly the repayment tenure will be increased and if Possible banks can Increase the EMI also. 

Going for a fixed rate is better if the fixed tenure is above 3 years and taking conformation from the bank that the rate will not be revised even there are any huge fluctuations in the market makes a sense.

Radiant Shine - Luxury apartments in bangalore

With the fresh trends in market and with the fresh technology coming up in the market it is Radiant's continuous activity to obtain and apply all those technologies to build the best residential apartments and to satisfy all those customer who trust the radiants brand for purchasing their properties in begur road bangalore.

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Radiant Shine - Properties in Begur Road Bangalore

Amenities

• Swimming pool with toddlers pool
• Children’s play area
• A well equipped gymnasium
• Indoor games room
• Multi-purpose hall
• Lifts
• Generator back up
• Round the clock security with intercom facility

Property Registration in Home Loan

It’s a very big worry to every customer on whose name they can register the property. Some customers want to register the property on their wife, mother or father’s name and will be in constant confusion whether it can be done or not. All banks do accept registering the property on mother, father or wife’s name if the sale agreement is made on their name only. It is mandatory they must be the co-applicants in the home loan application and should sign all the required documents for home loan and submit their proofs also. The amount to which the property should be registered depends on the agreement value and banks also. Some banks ask customer to register the property at market value or the loan amount availed and some banks allow customers to register the property at Govt. rates. The EMI amount will be debited from the applicant’s account but property can be on co-applicants name. At the same time applicant can take properties registered on mother, father and wife’s name as security to avail any mortgages loan from bank of financial institutions. Tax exemptions are applicable to home loans under section 80© of Income Tax Act

Why making more down payments is important?

All the customers who purchase property with the help of a home loan are requested to make down payment or margin money payment towards the sale consideration of a property. Usually before buying any property the vendee(purchaser) will finalize a property and pay some advance amount and get into agreement of sale with the Vendor(seller). Then purchase after applying for a home loan and at the time of disbursement bank will ask the purchaser to pay complete margin money which is done for payment to the vendor through bank. The margin money which the customer pays will stand as his own contribution in purchasing the property other than the bank loan.

It is always advisable to each and every customer to make more payment towards the margin money as it will reduce the EMI burden which the customer need to pay on Month on month basis. If the customers make more margin money payments he will have more no of benefits of which some are stated below.

•  Higher the margin money Lower will be the EMI 
•  Can opt for lower repayment period 
•  Interest Rate hikes will not affect the customer at any point in the repayment period 
•  Can save money and make part payments which saves interest on the paid amount 
•  Can avail home loan linked insurance at a lesser single premium 
•  If affected by any financial circumstances then customer can avail top-up loans on the property for a period of 10 years 
•  Lessee will be the banks processing fee 
•  Can avoid tenure hikes which happens by the interest rates revision

So plan accordingly before going for a home loan to make maximum down payment to be liability free for the complete home loan tenure.