As people’s incomes and living standards go up, more and more people, especially young people, look to Kotak Home Loan to help them buy their dream home. Some of them are often misled during their search by the myths and misunderstandings about home loans. If you’re going to buy a house, make sure you don’t believe any of the following myths when you apply for a home loan:
It’s best to choose the loan with the shortest term
Many people who are thinking about getting a Kotak Mahindra Bank Home Loan think that they should choose the shortest loan term possible so that they can finish the deal as soon as possible. But by doing this, borrowers put more stress on their finances because an EMI payment is higher for a shorter loan period. Higher EMI payments could cut your monthly income by a lot, and a higher FOIR could hurt your chances of getting a loan (Fixed obligation to income ratio).
Borrowers should choose longer repayment terms if they can get them so they can afford their EMI payments, and if they have extra cash, they should think about prepaying their house loan in full or in part.
Interest rates can not be negotiated at all.
For some reason, Kotak Home Loan borrowers still tend to think that the interest rates that mortgage lenders offer are fixed and can’t be changed. This is not at all true. If you don’t like the interest rate that the lender has given you, you might be able to negotiate with the lender for a lower rate, as long as you have a good reason to think you’re being treated unfairly. If you have a good credit score or a strong ability to pay back the loan, for example, you could talk to your lender about lowering your interest rate and getting better service terms. You could also try to find a different lender if your current one doesn’t work with you to find a solution.
You might want to use online financial websites or portals to find a better deal and the best lender for your home loan. These platforms, like Kotak Home Loan EMI Calculator tools that help you figure out your EMI, make it easy for you to compare and choose between the many lenders who offer loans. This helps you find the best lender for your needs and finances.
Always go with the lender whose rates are the lowest.
With interest rates on home loans ranging from 6.85% to 7.50%, it’s clear that the interest rate is one of the most important things to think about when choosing a lender and figuring out your EMI on the KotakHome Loan EMI Calculator. But that shouldn’t be the only thing you think about when making a decision like this. Many borrowers make the mistake of choosing the lender with the lowest house loan amount. They don’t think about other factors, such as the services offered (like extra loans), terms and conditions, maximum term, different ways to pay back the loan, or payment modes. Make sure to think about all of these things when choosing a lender, and choose the one who offers all of these services and has a lower interest rate than the competition. In some situations, a lender with a slightly higher interest rate on a Kotak Home Loan may also offer more services and better terms of service than a lender with a lower interest rate in the same situation.
A home loan will be guaranteed if you have a good credit score.
A lot of people think that if they have a higher credit score, they will automatically be approved for a home loan. Even though having a good credit score makes it more likely that you will get credit, it doesn’t guarantee that you will. Your application for a house loan will be approved based on a number of other factors, like your age, your income, your debt-to-income ratio, your job and employer’s profile, and your EMI, which you can find out by using the Kotak Mahindra Home Loan EMI Calculator. Before applying for a home loan, you should use an online loan eligibility calculator, which you can find on the websites of major financial markets. These help the borrower figure out if they can get an Kotak Mahindra Home Loan without having to fill out an application and wait for a reply from the lending institution.
Lenders charge big fees for foreclosure and paying off a loan early.
Another common misunderstanding about home loans is that lenders will charge borrowers a lot of money if they pay off their loans early. That’s not right. The Reserve Bank of India has told lenders that they can’t charge any fees for prepayment or foreclosure on floating-rate home loans. Fixed-rate home loans, on the other hand, may have such fees. The amount varies from lender to lender but is usually up to 2 percent.
When interest rates go up, Kotak Mahindra Home loan EMIs automatically go up as well.
When the Reserve Bank of India raises interest rates, many home loan borrowers’ first thought is that their EMIs will go up automatically, making them have trouble paying their bills every month. This is just a case of miscommunication. When interest rates on loans go up, lenders usually offer to extend the length of the loan so that your monthly payment doesn’t go up. But since the total amount of interest paid goes up if the loan term is lengthened, borrowers should pay the higher EMI if they can. But make sure to use the Kotak Mahindra home loan EMI calculator to get a good idea of how the EMI is likely to change.
Also, the higher interest rate won’t take effect until the reset term for your home loan is over. Existing borrowers can also take advantage of the home loan balance transfer option if they are sure that doing so would save them a lot of money (because of a lower interest rate).
