Get the Tata Capital App to apply for Loans & manage your account. Download Now

Blogs

SUPPORT

Menu  
 
Apply Now
Apply Now

Tata Capital > Blog > Don’t Over-Borrow. Find the Right Home Loan Amount

Loan for Home

Don’t Over-Borrow. Find the Right Home Loan Amount

Don’t Over-Borrow. Find the Right Home Loan Amount

When you are looking to buy a house, one of the major factors is the budget you have. This budget in turn depends on two things. First, your ability to bring in the required down payment and secondary, your ability to service the future monthly EMIs.

What is the right amount to borrow is a simple question. But it can have unique answer depending on person’s financial situation. Experts say that both under- as well as over-borrowing are dangerous. So how do you decide what is the right home loan amount?

Let’s look at some of the important factors.

Income Stability – If you have an income source that is stable and reliable, then you can a steady source of income or your job is stable then you may opt for higher Home Loan amount. But if you are not very sure about your future income level, then you should reduce the loan amount to the bare minimum. If it means that you will be paying more than 20% as down payment, then so be it.

Other EMIs – If you already have a few EMIs running (like care or personal loan), then its best to clear major ones first before going for a home loan. It is not easy to service 3-4 EMIs simultaneously. But if you don’t have a choice and will necessarily have to service 2-3 loans simultaneously, then take a home loan with long tenure to reduce your EMI outgoes initially. As and when your income increases, start prepaying the loans that have higher rate of interest first.

Increase Down-Payment – If you are planning to put in only 20% as down payment and have money parked in bank FDs, then this approach can be questioned. Bank FDs earn about 6% post taxes whereas loan requires you to pay 10-12%. So keeping the money in low-interest earning instruments when it can be used to decrease the amount for borrowing, doesn’t make sense. So if you think you are convinced, you can reduce your home loan amount by liquidating some low-interest earning assets and use to it increase your down payment. Get in touch with Tata Capital to avail a home loan at attractive home loan interest rates and explore a wide range of home financing solutions.

Apply for Housing Loan

Say Hello to Your New Home with Our Easy Home Loans!

Apply now
Popular Searches
anyror modt charges 712 utara online gujarat pre emi calculator earnest money deposit Goa Land Record earnest money khasra number meebhoomi Assam Land Record
More About Loans
home loan calculating home loan housing loan rate of interest calculate home loan eligibility documents needed for housing loan quick cash loan housing loan top up home loan transfer home loan with overdraft facility home loan balance transfer calculator home loan disbursement process loan for home extension rgrhcl
Disclaimer

Most Viewed Blogs

Trending Blogs

Calculator

Personal Loan EMI Calculator

Personal Loan EMI Calculator
Home Loan EMI Calculator

Home Loan EMI Calculator
Business Loan EMI Calculator

Business Loan EMI Calculator
Used Car Loan EMI Calculator

Used Car Loan EMI Calculator
Two Wheeler Loan EMI Calculator

Two Wheeler Loan EMI Calculator
Loan Against Securities Calculator

Loan Against Securities Calculator
Loan Against Property Calculator

Loan Against Property Calculator
More Tools

502 Bad Gateway

Microsoft-Azure-Application-Gateway/v2