Housing Loan Interest Rates

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5 Interesting Facts about Housing Loan Interest
Rates.

• Housing loan interest rates are an integral
  component of a home loan. However, in the attempt
  to find a lender that provides the lowest rates,
  most borrowers forget to acknowledge a few
  important features and facts about this cost.
  Thats why this article will throw light upon 5
  of the more interesting yet seldom dwelled upon
  points of home loan interest rates - hopefully,
  these pointers till influence your decisions in a
  positive manner.

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1. Interest rates depend on your loan slab.
So not only will different lenders have different
interest rates, but different loan amount also
have differing interest rates. For example, with
most leading lenders, loans up to 30 lakh will
have interest rates ranging between 8.55 and
9.05 per annum. On the other hand, if you were
planning to borrow above 30 lakh from the same
lender, youd have to as much as 8.65 or 9.15
percent per annum.
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2. Women get lower housing loan interest rates.
Its not a very known fact but women borrowers
get discounts on normal interest rates. This
discount can be as much 0.05 per annum. This
might seem like a negligible difference but
imagine a 0.05 on your principal amount every
month for 360 months (30 year tenure). Yes, that
will amount to a large sum of money saved. You
could enjoy these benefits by co-borrowing with a
woman, be it your wife, sister or mother.
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3. There are types of interest rates.
Before you apply, you should know which type of
housing loan interest rate is best suited for
your needs. Fixed rates stay constant throughout
the tenure of the loan. They aid full-proof
planning as they will never change. They are
better suited for older borrowers as they can
plan the repayment better keeping in mind their
retirement plans wherein their income sources
might be constrained. Floating rates on the
other hand are better suited for younger
borrowers. They are generally much lower than
fixed rates but could rise in the future, or fall
even further. Also, since younger borrowers will
have many working year ahead of them, they can
accommodate any rate hikes better since they have
salary appraisals and more bonuses to look
forward to.
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4. Joint home loan tax benefits.
If both you and your spouse deal with significant
tax deductions, it makes sense to borrow the loan
jointly. Firstly because on account of a woman
borrower, you will enjoy lower rates and secondly
because the tax benefits will be individually
applicable to both of you. This means the 1.5
lakh deduction under section 80C will be
applicable for both of you, as would the 2 lakh
deduction under section 24 which is provided
against the total interest amount paid in the
year.
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5. Todays interest rates are the lowest they
could get lower.
The housing loan interest rates applicable are
probably the lowest in the history of housing
finance. Meaning, if there was ever a good time
to take a home loan, its now. Some experts even
suggest that the rate will fall further in the
future, making floating loans a great option.
If you are in doubt regarding these points, it
makes sense to speak to a financial expert or
talk to one of the lenders about them. They will
guide you with the nitty-gritty details in regard
to these aspects of housing loan interest rates.
Good luck and all the best!
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