5 Interesting Facts about Housing Loan Interest Rates.

5 Interesting Facts about Housing Loan
Interest Rates.
Housing loan interest rates are an integral component of a home loan. However, in the attempt to find a
lender that provides the lowest rates, most borrowers forget to acknowledge a few important features
and facts about this cost. That’s why this article will throw light upon 5 of the more interesting yet
seldom dwelled upon points of home loan interest rates - hopefully, these pointers till influence your
decisions in a positive manner.

1. Interest rates depend on your loan slab.
So not only will different lenders have different interest rates, but different loan amount
also have differing interest rates. For example, with most leading lenders, loans up to 30
lakh will have interest rates ranging between 8.55% and 9.05% per annum. On the other
hand, if you were planning to borrow above 30 lakh from the same lender, you’d have to as
much as 8.65 or 9.15 percent per annum.

2. Women get lower housing loan interest rates.
It’s not a very known fact but women borrowers get discounts on normal interest rates.
This discount can be as much 0.05% per annum. This might seem like a negligible
difference but imagine a 0.05% on your principal amount every month for 360 months
(30 year tenure). Yes, that will amount to a large sum of money saved. You could enjoy
these benefits by co-borrowing with a woman, be it your wife, sister or mother.

3. There are types of interest rates.
Before you apply, you should know which type of housing loan interest rate is best suited for
your needs. Fixed rates stay constant throughout the tenure of the loan. They aid full-proof
planning as they will never change. They are better suited for older borrowers as they can plan
the repayment better keeping in mind their retirement plans wherein their income sources
might be constrained.
Floating rates on the other hand are better suited for younger borrowers. They are generally
much lower than fixed rates but could rise in the future, or fall even further. Also, since
younger borrowers will have many working year ahead of them, they can accommodate any
rate hikes better since they have salary appraisals and more bonuses to look forward to.

4. Joint home loan tax benefits.
If both you and your spouse deal with significant tax deductions, it makes sense to
borrow the loan jointly. Firstly because on account of a woman borrower, you will enjoy
lower rates and secondly because the tax benefits will be individually applicable to both
of you. This means the 1.5 lakh deduction under section 80C will be applicable for both
of you, as would the 2 lakh deduction under section 24 which is provided against the
total interest amount paid in the year.

5. Today’s interest rates are the lowest & they could get lower.
The housing loan interest rates applicable are probably the lowest in the history of
housing finance. Meaning, if there was ever a good time to take a home loan, it’s now.
Some experts even suggest that the rate will fall further in the future, making floating
loans a great option.
If you are in doubt regarding these points, it makes sense to speak to a financial expert or
talk to one of the lenders about them. They will guide you with the nitty-gritty details in
regard to these aspects of housing loan interest rates. Good luck and all the best!

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