Home Loan in India: Interest Rates, Eligibility & Benefits
Buying house is big dream for all Indian family. But house price now very high. Poor or normal people don't have full cash money in hand to buy house directly. So people go bank to take home loan.
At Rawani Grow, we explain money things in very simple language. No big English words. No hard banking terms. Here is simple guide for you.
1. What is Interest Rate?
Bank never give loan money for free. They take extra money from you every month. That extra money is called interest.
Every month you give back one fixed money to bank. People call this monthly money EMI.
Banks have two types of interest:
Floating Rate: This rate change up and down. If government change rules, your monthly EMI become less or more.
Fixed Rate: This rate stay same full time. From starting day to end day, your EMI never change.
Tip: Always ask bank to give low interest rate. Small drop in rate save you big money over 15 or 20 year time.
2. Who Can Get Home Loan?
Bank check if you can return money every month or not. They check these things:
Age: You must be 21 year old minimum. Loan must finish before you become 60 or 65 year old.
Monthly Income: If you do job, salary must come in bank every month. If you run small shop or business, show earning proof for 2 or 3 year.
CIBIL Score: This is mark sheet for your old loans. If you pay old bills and loans on time, score goes up. Score of 750 or more gives fast loan approval with low interest.
Other Loans: If you already pay EMI for bike, mobile, or car, bank give you less home loan money.
3. How Home Loan Save Income Tax?
If you pay income tax to government, home loan help you pay less tax:
Tax Discount on Interest: You can save tax on up to ₹2 Lakh every year from interest money you pay.
Tax Discount on Main Loan: You can save tax on up to ₹1.5 Lakh every year from main loan money you pay back.
Joint Loan with Wife: If husband and wife take loan together, both get tax savings separately. That means double tax savings for home!
Simple Message from Rawani Grow
Home loan takes long time—15 to 20 years. Don't take very big loan that take away all your monthly salary. Keep EMI small so your family can live without money tension.
At Rawani Grow, we always help you in simple way so you can get dream home easily.
Simple FAQs
1. What is difference between floating rate and fixed rate in home loan?
Floating rate going up and down when bank or RBI change rule, so your EMI become small or big. But fixed rate stay same all time, so your monthly EMI never change from first day to last day.
2. How much CIBIL score I need to get home loan easily from bank?
You need CIBIL score 750 or more to get loan fast from bank. Good score showing bank that you paying all old shop loan, bike EMI, and mobile bills on time without any problem.
3. Can husband and wife take home loan together to save double tax?
Yes, if husband and wife taking loan together, both can save tax separately in own tax paper. This giving double tax discount for same home, so full family saving big money every year.
4. How much tax discount I get on interest money every year?
You can saving income tax on up to ₹2 Lakh every year on interest money you giving to bank. This helping you to pay less tax to government when filing tax paper.
5. How much tax discount I get on main loan payment under Section 80C?
Under Section 80C, you can save tax on up to ₹1.5 Lakh every year on main loan money you returning back to bank. House registry paper charge and stamp duty fees also coming inside this limit.