Securing Hannav Ledger...
Securing Hannav Ledger...
Glossary
Home loan is a secured loan from banks or HFCs to purchase, construct, or renovate residential property, with the property as collateral.
Home loan is bank money to buy a house — you pay EMI for years; the bank holds your property papers till loan is cleared.
Loan-to-value up to 75–90% of property value. Tax benefits on interest (Section 24) and principal (80C) in old regime. Floating linked to repo/MCLR or fixed rates. Prepayment allowed with possible charges on fixed-rate products.
₹60 lakh property, ₹48 lakh loan (80% LTV), 8.5%, 20 years → EMI ~₹41,600. Tax savings on interest may reduce effective cost for old regime taxpayers.
Fixed offers rate certainty initially; floating adjusts with market rates, often cheaper long term but EMI volatility.
Disbursement linked to construction stages. Pre-EMI interest may apply before full disbursement — tax deduction rules differ.
Balance transfer refinances at lower rate. Compare processing fee, lost benefits, and new tenure before switching.