Are you thinking of moving to an own house? Wondering where to start and how to go about owning a new house? It is true that youngsters are keeping moving from one location to the other as per their job requirement, but they will still have a dream for own house. This will be mostly considered at a location where their hometown is located. It is a tough challenge for those who are constructing home for the first time to put everything to the right place. In order to make the process more simplified and easier we have examined the requirements for owning a house and here are some handy-tips.
- Find out what type of home suits your needs:
While some prefer independent house, some others are looking for much more secured style of living like apartments or gated community. It is crucial to finalize what type of home will suit your needs and accordingly you should start prepare an estimate and make decision on other factors. In the recent trends, many are choosing apartments as it is much more affordable and requires less time for maintenance. All generations are keen to pay some monthly amount towards maintaining the apartments or gated community rather than investing time and effort on cleaning independent house.
- Have a budget plan prepared:
Even before you start looking for a property, it is important to calculate your budget. This information is very essential for brokers to give you options for you to choose from. Unless you have a budget finalized, it will not be possible to finalize a property. Once budget is decided you will be able to pick locality, builder, and property value and so on according to the estimates. This is the best way to get you prepared financially before stepping to big projects such as owning a house.
- Evaluate your savings:
While you are deciding the budget, an evaluation of the savings should be done simultaneously. This way you will have a clear picture of how much is the available fund and what would be the maximum debt required to be taken in the form or loan. Also a detailed check should be done of the savings that can be easily liquidated versus those that requires time to get liquidated. For example: savings in bank accounts are easy to liquidate while any investment in stock or government securities might have a lock period. Get an estimate of what would be the available fund from each source and then calculate the actual savings available.
This table will help you understand how to measure your maximum loan amount by considering your gross monthly income.
|Gross Monthly Income||Maximum Installment||Maximum Loan|
- Decide between buying or constructing:
Whether to buy a fully or semi-constructed house or buying land and constructing is another major confusing that most of the new home owners will have to face. Though many prefer buying a property and designing a home per their plan, it is not as easy as it is said. Firstly getting a land without any legal issues is a problem and top of that you will have to look into each and every minute things right from the foundation materials to the final interior works. This is ideal for those who have enough time to spend until the whole construction is complete. Nowadays, many are busy with tight scheduled work and can hardly find any time for themselves, at these situations the best option is buying and moving to a house that is constructed and ready to move.
- Finalize the location:
Based on the budget, convenience and amenities available you should pick top 5 locations and finalize the best and affordable one from this list. Employed couples would prefer locations that are close of work location and within city limits, while retired couples would prefer a location that is close-by to city but at the same time away from pollution and traffic. Apart from these accessibility to hospitals, schools, markets are other things considered before finalizing the location to settle with an own house.
- Improve your CIBIL score:
Owning a house is a dream for many and more than 76% of Indian’s go for a home loan option. This is to get the benefit of tax exemptions, and because it helps to possess the property immediately even without full cash. However, for any type of home loan CIBIL score of the applicant is given major importance. If the credit worthiness of the individual is low, getting a loan approved is difficult plus the interest rates and other charges will be high. It is possible to improve the CIBIL scoring by reducing the outstanding debts, by making regular timely payments of EMIs, by avoiding applying for too many loans.
- Find out how much mortgage is required:
If you are planning to take the route of home loan then banks will require a mortgage or security for approving the loan amount. This is to make sure that the bank will be able to mitigate the loss in case if the applicant defaults the EMIs or failing to repay back the loan amount. In case of home loans, not many banks will need a separate mortgage as the property in itself will be with the bank. Only post repayment of the complete loan amount, the ownership will be transferred from the bank to the actual owner. In any case, if it good to check if the bank you are applying for home loan needs a mortgage and how much it should be.
- Hunt for best loan provider:
If you are looking for a home loan for owning a house, there are two ways to getting necessary information. One is buying visiting different banks to get their loan details while the easier and best option is visiting Finance Buddha for comparison of home loans and to pick the best bank. With the help of this website, it is even possible to apply for a home loan in just a few clicks. The services are reliable and it’s very quick. Requires very less time and it is even possible to negotiate with banks on interest rates, charges and loan amount based on the credit worthiness and past payment records.
Apart from these, there are some more points that should be kept in mind before owning a house in India:
- Look out for the credibility of the builder
- Create a structure for your repayment plans
- Complete all the legal due diligence works related to the property
- Don’t pull out all your savings for owning a house, keep aside something for emergency and future requirements
- Get clear clarity about different interest rates and other charges
- Spend enough time to know about getting a pre-loan
- Learn differences between super built up and sq. feet, built up
- Be ready to negotiate
- Once the initial payment is made, get the allotment letter from the builder
- Make sure you have time for regular site visits
- Go through the sale deed more than twice
- Get a lawyer to verify all legal documents related to house purchase/ construction
- Know the difference between possession and registration. Only post registration the legal ownership will be transferred to you
In order to further simplify owning a house, here are 9 steps to be considered:
- Determine what you can truly afford
- Figure out which mortgage is right for you and get it pre-approved
- Consider a financial trial run
- Decide which features are must-haves and nice-to-haves
- Start house-hunting, and decide if you need a real-estate agent
- Research about homeowner’s insurance
- Put in an offer- have an amount fixed for yourself
- Review the contract and pick the most suitable property
- Sign the papers and own your house
In order to make sure everything falls into place, get a simple checklist created. It should be an open checklist wherein you can add or remove things as and when you progress with your own house. Sample checklist is mentioned below, consider creating something similar as per your requirements and needs.
|Checklist||Must Have||Like to Have|
|Number of Bedrooms||2||3|
|Number of Living Rooms||1||2|
|Outdoor Living Area||–||Yes|
|Off Street Parking||–||Yes|
|Fenced & Gated||Yes||–|
Other needs are:
- Must be close to education institutions
- Accessibility to hospitals and malls
- Should have vegetable garden and so on
Make use of the home buying guide for own your dream home at the best possible price without compromising on the quality. This page is the make sure you get the best and memorable experience in your very first home buying plan. Go through each and every tips mentioned and do a thorough scrutiny from your end and pick the one that suits your plan and needs. Good luck with your new home decision!