Home loan - Everything You Need to Know Home Loan is Given by Banks, Housing Finance Companies, NBFCs Home Loan Can be used to: Buy a Plot Land Construct a house Repair/Renovate house Home loan is secured loan. House is collateral or security till the home loan is repaid. Types of Home Loans New Home Loans Pre-approved Home Loan Home Purchase Loans Home Loan for Construction Plot Loans Home Loan Top Up Home Extension/Renovation Loans Balance Transfer Home Loan Home Loans for NRIs Terminologies: Principal Down Payment Eligible Loan Amount Co-applicant Fixed rate of interest Floating interest rate Equated Monthly Installment (EMI) Processing fees NOC Occupancy Certificate Reset Clause Basis Point Tripartite agreement Eligibility: Age: 21 to 60 years and self-employed should be between 21 to 65 years. Job Stability Income Level Credit Rating Other Loans Resident Type Types of Interest rates on Home Loans: Fixed rate Home Loan Fees & Charges: Processing fees Prepayment charges Conversion fees: Cheque dishonour charges Fees on account of external opinion Home insurance Default charges Incidental charges Statutory/regulatory charges Photocopy of documents C Change in loan term Application Fee Technical Valuation Charges Administrative Fee Balance Transfer Charges Legal Fee Franking Fee Notary Fee Indemnity Cost Recovery Charges Floating rate of interest. Home Loan Tax Benefits: Deduction for Interest Paid on Housing Loan Deduction in respect of interest paid towards home loan during pre-construction period Deduction on Principal repayment Deduction For Stamp Duty and Registration Charges(limit 1.5 lakhs and should be claimed same year) Additional deduction under section 80EE A dditional deduction under section 80EEA Deduction for Joint Home Loan Remember below points while choosing a home loan : Due diligence Interest rate negotiation Check for hidden charges Compare different lenders Tenure Read Terms & Conditions Credit score Reasons for Home Loan Rejection: Bad or low credit score Incorrect personal details in credit report Rejection of loan by other banks Unstable income Age factor Location of the property Poor repayment capabilities