What Is Home Loan
A home loan is an amount of money that an individual borrows from a bank or money lending company at a certain rate of interest to be paid with the EMI every month. The property is taken as a security by the money lending company for the Home Loan. The property can either be commercial or personal in nature. When the borrower cannot pay the dues, the lender will possess all the legal rights to recover the outstanding loan amount by sale of the property in question.Types of Home Loans: Home Purchase Loan: This is the loan that one takes for purchasing a home. Home Improvement Loan: This loan covers expenditure related to repairs of your home or even renovation.Home Construction Loan: This loan comes in handy when you are building a new house.Land Purchase Loan: Someone wishing to buy a plot of land for constructing his/her own house can avail this loan. Home Extension Loan: Suppose you plan to add another room, garage, bathroom or kitchen to your home. This is the loan that you should apply for and this also comes in handy if you are planning to have another floor.
How To Pay For Furniture For Your New Home
Congratulations, you just bought your dream house! Now its time to make that house a home. Step one: furnishing the place. Unfortunately, furniture costs can get expensive fast.
According to real estate agent Sarah Bowles of Urban Habitat, furnishing a new home from scratch can cost up to 25% of your homes value. Furnishing a new home will require some financial planning. The question is, how will you foot the bill?
Here’s How To Finance Your Remodel
Financing a remodeling project doesn’t have to be a crapshoot. Here’s a game plan for choosing the best deal.
Until recently, borrowing money for a new kitchen, second-story addition, or other home improvement meant going to the bank, seeing a loan officer, and hoping for the best. Today, however, you have many more options to help finance home improvements. A mortgage broker, for example, can offer more than 200 different loan programs. And brokers are just one of the many lenders eager to put together a loan that fits your situationeven if your credit history is less than perfect.
That means you might be able to borrow more money than you think. But with so many competing lenders, loan options, and terms, it also means shopping for home remodel loans can be as challenging as house hunting. You can skip all the confusion and land on the right lending program by:
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Furnishing Your New Home Purchase Prior To Closing On Home Loan
This article is about Furnishing Your New Home Purchase Prior To Closing On Home Loan
Furnishing Your New Home Purchase:
Furnishing your new home purchase is exciting:
- It is probably the most memorable time for homeowners
- Most homebuyers cannot wait in going out shopping for new furniture once they have an executed real estate purchase contract
- Homebuyers furnishing your new home purchase should wait until they have closed on their home
- There are many things to consider when furnishing your new home purchase
- Purchasing your new furniture, especially using funds from your bank account or buying new furnishings with credit can be like playing with fire
- Many furniture companies will offer special deals if consumers apply for their furniture credit cards
- Many furniture credit cards will offer zero interest for one year or no payment until a later date where most home buyers cannot refuse
- However, buying new furniture can have a devastating outcome when it comes to the mortgage application process
Charges For Home Improvement Loan For Salaried
You have a right to know exactly how much you will need to pay for your home improvement loan and when. You can find below the list of charges and rates applicable. We make it a point to be transparent about how our home improvement loan works, so you can rest easy with the support of the local experts who sit out of our branches.;
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What Are The Options
Loan shopping often starts with mainstream mortgages from banks, credit unions, and brokers. Like all mortgages, they use your home as collateral and the interest on them is deductible.
Unlike some, however, these loans are insured by the Federal Housing Administration or Veterans Administration , or bought from your lender by Fannie Mae and Freddie Mac, two corporations set up by Congress for that purpose. Referred to as A loans from A lenders, they have the lowest interest. The catch: You need A credit to get them. Because you probably have a mortgage on your home, any home improvement mortgage really is a second mortgage. That might sound ominous, but a second mortgage probably costs less than refinancing if the rate on your existing one is low.
Find out by averaging the rates for the first and second mortgages. If the result is lower than current rates, a second mortgage is cheaper. When should you refinance? If your home has appreciated considerably and you can refinance with a lower-interest, 15-year loan. Or, if the rate available on a refinance is less than the average of your first mortgage and a second one. If you’re not refinancing, consider these loan types:
Most programs require repayment after 8 to 10 years. Banks, credit unions, brokerage houses, and finance companies all market these loans aggressively. Credit lines, fees, and interest rates vary widely, so shop carefully. Watch out for lenders that suck you in with a low initial rate, then jack it up.
Not Comparing The Loan Estimate To The Closing Disclosure
Your lender is required by law to provide you with the closing disclosure three business days prior to your closing date. This document lists the exact costs youre expected to pay at closing, including your down payment, closing costs, loan details and terms, and other important information. Its a five-page document; take the time to compare it against the initial loan estimate you received to make sure you arent being charged extra fees by your lender or other parties involved in the transaction.
Also, if certain fees go up more than expected, ask your lender to explain why. Make sure basic details, such as your name and other identifying information, are listed correctly so you dont run into paperwork issues on the closing day. If you find errors or questionable or unexplained extra fees, tell your lender immediately so those issues can be addressed. In some cases, your closing might have to be pushed back to ensure the paperwork is corrected and updated, and all issues are resolved.
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Why Not Just Leave Your House And Mortgage Off Your Balance Sheet
If you rent the space where you live, you generally dont include your future rent payments as a liability, even though they are, in one sense. Furthermore, the increasing or decreasing value of your house has little relationship to your financial activities on a day-to-day basis. Your net worth could be increasing every year due to your living in a developing neighborhood, but this could be masking financial problems with credit and debt, or other decisions with money that will eventually get you into trouble.
What good is your net worth bottom line if it reflects positive increases during a period where your checking account is dealing with overdrafts and your credit card balances are increasing?
This is why its important to look at more than just the bottom line of a net worth statement. When you see an increase in net worth from month to month, look at the details. Did he receive a windfall inheritance? Is he changing his houses value every month based on an estimate? Did she pay off her debt but completely deplete her emergency fund? Context and details are important in a net worth calculation. Otherwise, its just a number that doesnt explain much about ones financial situation.
But how do you come up with the right value for your house? Ill look at some methods for determining your houses value for the purpose of net worth in a future article.
Do I Need To Insure My Assets
It may be a good move to buy insurance to protect your assets. Some of your assets may already be insured certain laws mandate that your home or your car are insured.
Your home insurance may cover the value of some of your belongings, but if you have high-value jewelry, you might consider purchasing separate insurance or add on to your existing home insurance plan. For example, youll typically pay $1 $2 for each $100 of value for jewelry coverage.
You can also protect your income in the event that you are not able to work due to a physical injury or illness. Your job may provide disability insurance, but you also might want to purchase your own policy in case you are hurt or injured outside of work.
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Overview Home Improvement Loan For Salaried
Your home is your identity. It reflects the life that you have built for you and your family. You feel safest within these four walls, where everything is comfortable and familiar. Home is where you can always relax, no matter how tiring the day was.
As your family gets bigger, so do your dreams, and you aspire for an even better quality of life for your children. An ICICI HFC Home Improvement loan is the financial backing you need to ensure your beloved home keeps up with your way of life.
Whether it is an expansion, a renovation, an essential repair, or structural changes to your home, you get the financial support to ensure you, your children, your parents and even your guests are always safe and secure.
Offers In Housing Loan:
Housing loan comes with a lot of offers and concessions. It offers low-interest-rate with long repayment tenure. It makes monthly EMIs lower so that your monthly expenses are done without liquidity crunch. No prepayment charges for the housing loans. Whenever you have more funds, you can part pay the housing loan to reduce your liabilities. It also allows for a balance transfer facility. With this facility, you can transfer the housing loan balance to a lender who offers lower interest. Housing loan is a low-cost debt to create an asset.
No hassles from Landlord:
In a rented house, be it minor or major repair, the rented house needs landlord permission. You depend on electricity, water, car parking, and maintenance on the landlord. You always have some worries about renewing the lease agreement. The landlord may ask you to vacate for any reason at any time. If you live in your own property, you live a peaceful life. If you live in your own house, your home is constructed as per your choice. You live without any hassles of the landlord.
Saves you from paying Rent:
To encourage more people to buy a home, the Indian Government offers a lot of tax benefits for a home loan. You can claim more tax deductions for housing loans every year under Income Tax. There are deductions available for principal repayment, interest, and stamp duty and registration charges.
Benefits of Special deduction for first home time buyers
Contact the Best Housing Loan Consultants
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Why New Furniture Could Cost You Your Home Loan
Sometimes, families going through the loan process are so excited about the prospect of purchasing a home and how that home will look that they jump the gun and either make a major purchase with their credit card or open a new credit card to make some major purchases.;
As weve discussed in previous videos, this can have a detrimental impact on your credit. There are some loan programs that require us to do a soft credit pull prior to closing, so well see any credit inquiries for large purchases. Depending on the purchase amount and what it does to your credit score, this could affect your qualification and eventual closing.;
Even though furniture stores can offer you 0% financing for 60 months, what theyre essentially doing is providing you a credit card, which is a revolving credit line that will report to all three major credit bureaus. When you apply for the stores financing, that will show up on your credit history and, in turn, drop your credit score because a computer doesnt understand the circumstances involved. It doesnt know whether youre credit-seeking or youve perhaps fallen on hard times and youre trying to take out a card and max it out.;
Ways To Finance Your Furniture Buying Spree
If you’re about to buy furniture and plan on financing some or all of it, read this extensive article setting out 7 ways to finance furniture .
Buying furniture is like buying a car. As soon as you take it from the store, its lost value. BUT, thats not the right way to think about furniture purchases. In fact, thats pretty grim.
The fact is, having nice and comfortable furniture can improve your enjoyment of your home and your lifestyle.
Also, you often get what you pay for. In our twenties, just out of school, my wife and I bought plenty of low-cost, assemble-yourself furniture. It looked decent, but much of it didnt last nearly as long as quality furniture.
Our problem was that we wanted to wait until we moved into what will be our main family home before spending serious money on furniture. But, once we get our new home , buying decent furniture will be part of the process.
Were not 100 per cent sure how well be financing our furniture, but weve done the research so that we know our options. I dont think well go too crazy, but we will make some big purchases, some of which well no doubt finance. This article sets out our research findings for financing furniture.
Our date in a furniture store
I digress back to the main subject.
This extensive article explains the main options you have to finance your furniture purchases.
Alright, lets get started
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How Much Does New Furniture Cost
The cost of new furniture depends on the type and quality youre looking for. While you can get a dining room set for as little as $129 at Ikea and similar stores, you can easily spend 20 times that amount at a high-end retailer. Below we show the average price for various furniture, according to estimates from ForRent.com.
Where To Go From Here
The next step in the journey to acquiring the furniture you want so dearly is yours and yours alone. Its up to you to take the information that has been provided to you and decide your course of action as to how you are going to purchase the furniture that you want without digging yourself into a hole of debt and additional payments.
In order to do this, you will have to take a look at your current financial situation.
- How much cash;do you currently have available?
- Can you afford additional debt? Its imperative you carefully assess your current and future monthly budget.
- Whats your credit score? Can you get a decent interest rate?
- Do you have low-interest borrowing options such as home equity loan or unsecured line of credit?
- Are you in dire need of the furniture now, but lack the funds?
- Are you willing to chance your future finances on one of the riskier options such as using a credit card or payday loan?
All of these questions need to be taken into account before an informed decision can be reached. Then you must find which finance plan fits your specific criteria. No, its not easy, but if done correctly, you will have the furniture that youve had your eye on and most importantly, your financial future will be far more secure.
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Skipping The Home Inspection
Unless you have a lot of cash to fix up a home and are willing to risk having to pay for unforeseen repairs, waiving a home inspection can be a costly mistake. Home inspections are meant to find major issues with a home, and they are intended to protect the buyer.
If you dont get an inspection, you will have no recourse if a major issue, such as cracked pipes or water damage, surfaces after you close on a home. That means you might be footing the entire bill to fix those issues. When you make an offer on a home, you can include a home inspection contingency that gives you a penalty-free exit from the deal if a major issue is uncovered and the seller is unwilling to fix it before closing.
With that contingency in place, you can withdraw your offer and usually get your full earnest money deposit refunded. The home inspection fee is non-refundable and typically paid by the buyer to the home inspector up-front. It typically ranges from $300 to $500, depending on location and the size of the property. Its a small price to pay when you weigh it against the potential costs of having to replace a furnace, water heater, roof, or other big-ticket itemswhich could mount into the thousands.
You might consider additional inspections, such as a pest inspection, mold or radon inspection, or a sewer scope, for example, if your lender requests it. These and other inspections can help protect your investment and safety.