Buying a home is a major milestone, but high interest rates can make home loans expensive. Smart borrowers know that by strategically planning their loan, they can save lakhs of rupees over the loan tenure. Here are 7 proven methods to secure a cheaper home loan:
1. Compare Multiple Lenders: Don’t settle for the first offer. Check rates from public sector banks, private banks, and housing finance companies to find the most competitive interest rate.
2. Negotiate the Interest Rate: Many banks are open to negotiation, especially if you have a good credit score or existing banking relationship. A 0.25–0.5% lower rate can save significant money.
3. Maintain a High Credit Score: Lenders offer better interest rates to borrowers with scores above 750. Timely payment of EMIs and credit card bills boosts your score.
4. Opt for Shorter Loan Tenures: While longer tenures reduce EMI, they increase total interest. Choosing a slightly shorter tenure can lower the overall interest cost.
5. Pay a Larger Down Payment: Increasing your down payment reduces the loan amount, which in turn reduces the interest burden.
6. Prepay or Part-Pay Strategically: Prepaying or part-paying the loan when you have surplus funds can significantly reduce interest outgo, especially in the early years of the loan.
7. Check for Processing Fee Waivers & Special Offers: Banks often have limited-time offers with lower processing fees or interest rate discounts. Keep an eye out for these deals.
Additional Tip: Some banks offer special home loan schemes for women or first-time buyers at reduced rates—exploring such options can also help save money.
By combining these methods, borrowers can secure a more affordable home loan, reduce financial stress, and make their dream home more accessible.
Disclaimer:
The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of any agency, organization, employer, or company. All information provided is for general informational purposes only. While every effort has been made to ensure accuracy, we make no representations or warranties of any kind, express or implied, about the completeness, reliability, or suitability of the information contained herein. Readers are advised to verify facts and seek professional advice where necessary. Any reliance placed on such information is strictly at the reader’s own risk.
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