These have been specifically designed to not let you miss on the possibility to make such dreams come true without having to pay all the money up front. There are many factors associated with a home loan which you are required to know before taking a loan.

1. The factors which may affect the eligibility criteria: The best way to calculate your mortgage loan eligibility is by calculating the EMI. Generally, banks limit the total amount to 40 and 50% of the borrower’s income – like the basic salary and the dearness allowance. In addition, it considers the credit history of a borrower. So if you have any existing loan or a poor credit score, the loan amount will be decreased further or you may have to pay a greater rate of interest on the home loan. People with a stable income, strong repayment capability and good credit report find it relatively easier to get a loan as compared to those with erratic earnings and poor credit history. Also getting a co-applicant allows you to acquire a home loan easily.

2. Understand your hdfc home loan type: Banks offer home loans in two interest types – the fixed interest loan and the floating interest loan. The fixed interest loan is a kind of mortgage loan where the interest levels remain same and borrower has to pay a fixed EMI throughout the loan tenure. On the contrary, in case of a floating interest, it varies as per the market conditions that lead to fluctuation in EMI amount usually.

3. Do not forget to negotiate the rate with your lender no matter what kind of loan you choose. Though the banks would always have an edge, you need to haggle in this particular, particularly if you have been a loyal customer of the bank and have savings account in the same bank. The negotiation would be a lot easier if you have a definite credit history. Since the lenders have business targets, they can be more flexible at this time if they desire the business.

4. The fine print: A home loan agreement is a legal document that has everything of the loan. If you feel that not paying the EMI on time will only lead to troubles, you’re wrong! There are plenty of clauses hidden in the fine print out. Thus it is advised to read the next papers of the loan agreement carefully before signing the dotted line. You should be aware of the loan processing fee, penalty charge, hidden clauses, service charge and prepayment penalty, etc.

5. Longer loan term means costlier loans: In most cases of thumb, the longer the tenure of the loan, more will be the interest you are likely to pay over a period of time. Some can afford the increase, but not all. Therefore, it is advisable to request a financing amount that can be repaid within the shortest time frame. In this way, you might end up having to pay huge EMIs but for a shorter duration and without propping up more interest.

These are quite a few things that you must retain in mind while applying for a mortgage loan. Note that if you get a loan from one bank doesn’t mean you are stuck there before time your loan is fully paid. You always have the option to switch.

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