So, you’ve finally decided to take the plunge: you want to purchase a home. Well, congratulations! Buying that first home can be both exciting and scary at the same time, especially if it’s your first time doing so. The more you know about what you’re getting yourself into and how to manage your finances responsibly from the get-go, the smoother your housing journey will be.
Here, we explain exactly what you need to know about purchasing that first home and also provide tips, suggestions, and advice for investing responsibly.
- Evaluate your financial situation
Evaluating your financial health is a necessity before going through the rigors of applying for housing finance. You should look at your savings and see if you have enough to make a down payment towards your home loan. The financial health check you need to carry out before buying a home loan is something most of us skip as we are more occupied with searching for properties. Assess bank balances but also assess family situations. A home loan is a big commitment to make and going in blind can cost you over time.
- Save enough for a down payment
The biggest hurdle to homeownership is the down payment. When you think about it, it makes sense. You’re going from nothing to something. Start building a home deposit fund now, so you’ll be able to afford a down payment in no time. When you save enough for a good down payment, you reduce your interest rate and financial burden for the years to come.
- Do not choose a longer repayment period
You might have heard that a higher EMI payment would keep your monthly budget intact whereas in case you choose a longer repayment tenure, the EMIs will be lower but the tenure will be comparatively longer. It’s true that if you choose a higher tenure, you might be getting lower EMIs but in the long run, it will cost you more which would get multiplied due to interest calculations.
Hence, before deciding on a payment period, you should calculate the amount of money that you repay as interest per month and then compare it with your income. If the amount is higher than what you earn, then you should refrain from this option. Instead, you should choose a tenure that is comparatively shorter but for which you can afford to pay EMIs comfortably because there is no point in investing more in the home loan EMI instead of saving for something better.
- Take advantage of affordable housing schemes
For a lot of home buyers, finding affordable homes poses a problem. However, there is help at hand. In addition to Agrim home loan, you can take advantage of the Credit Linked Subsidy Scheme (CLSS) under the Pradhan Mantri Awas Yojana (PMAY), offered by reputed lending institutions on a home loan.
The best thing about these schemes, besides offering a subsidy on the interest rates, is that it is available only to first time home buyers. Another advantage that PMAY offers is that you need not pay any processing fee. There are numerous options available. You must do adequate research and find schemes that help your situation.
Buying a home is an important milestone for most families. As our personal and professional responsibilities grow, so does the urge to own a home. We’re no longer just planning for a future that is convenient for us, but also a home that’s safe and comfortable. With Agrim Housing Finance, fulfilling your home ownership dreams becomes a reality. They provide simple and easy home loans to the informal sector in economically weaker sections.
