Get An Affordable Home Loan Interest

Having a home of their own or a second home is a far-fetched dream for many

. The ever rising cost of real estate has been a major contributor in discouraging customers from investing in property. But with the finance solution product called home loan, consumers can easily fulfill their dream of buying a house. There are several providers for home loan in the market. But one actually should look out for a provider who sanctions loan for the required amount at an interest rate that is affordable, like Bajaj finance home loan rates.

Getting the loan sanctioned is not the end of the story but the beginning of it. Repaying the loan is the major aspect of a home loan. Hence make sure that the EMI you need to pay is affordable keeping in mind the other expenses you need to meet. The interest rate levied on the home loan plays a major role in deciding the EMI you need to pay, the other factors that contribute are the amount of loan availed and the tenure for which the loan is taken. Hence the higher the interest rate the higher is the EMI you need to pay. Remember, the EMI is calculated on a monthly reducing balance method. To make the home loans all the more convenient for the customers, banks and financial institutes offer two types of interest rates

Fixed Interest Rate

This type of an interest rate is a predetermined amount that remains the same for the entire term of the loan. Lets elaborate with an example

If you have availed a loan for the amount Rs. 25lakhs for 20 years on fixed interest rate basis of 11.50%. This interest rate remains the same for the entire term of the loan. So you are liable to pay just Rs. 26661 as EMI for the duration of the loan. The amount remains unchanged till the last EMI you pay.

An important fact to keep in mind is that most of the fixed home loans offered by the providers may not necessarily be fixed for the entire term. Many of these providers insert a clause as per which they have the liberty to reset the interest rate after 3 to 5 years. This means that interest rates can be changed after a period of every 3 to 5 years as stated in the loan document.

Floating Interest Rates

This type of an interest rate is related to the benchmark rate or the base rate of the bank or the financial institution. It is subject to change as and when the bank changes the benchmark rate or the base rate. For instance in case you take a home loan of Rs. 25lakhs for 20 years on floating loan basis, the interest levied in the first few months may be around 9.5% but could be revised to 10% for the first 4 months of the next year of the loan. However, it is not necessary that the interest rate will always be on the rise. There are possibilities that it may go down.

Bajaj finance home loan rates are amongst the most affordable rates you can get in the market. Not only are they easy to afford but Bajaj Finance also makes it easy for the customer to pay off the amount with flexible payment options. Also the scheme allows you pre-payment of the loan amount up to 6 times across the tenure. There are no charges on the prepayment.

by: ytr

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