If you have decided to buy a new house, you must tick certain important boxes. The key to making your dream of being a homeowner come true is to be financially disciplined and make informed choices. Read on to get a few tips for buying a house in 2021.

The onset of the COVID-19 purview has taken a massive toll on all. Not only has it resulted in thousands of deaths worldwide, but it has also had an enormous financial impact on the economy as well as on the individuals. Many people have been facing pay cuts, which have forced them to review their current and future financial goals.

In such a situation, if you are planning to buy a home in 2021, you must plan your expenses well. The following tips can immensely help you:

Choose the property location wisely

Often the price of the property depends on its location. Typically, properties in urban areas are valued higher than the properties located in remote locations. When you plan to buy a new house, you must choose the location wisely. The area should have good infrastructure facilities, and the place must be easily accessible for all. Experts recommend buying a house in a location that is an upcoming suburb so that you can eventually get a good resale value for the property.

Prepare a budget

One of the most important steps in buying a new house is to prepare a proper budget. This will help you know exactly the maximum amount you can afford to spend towards purchasing a home after meeting your monthly expenses. Having a budget will also help you understand the maximum loan you can borrow so that the EMI is affordable.

Compare the loan offers

Once you zero down on the location and the property, the next step is to choose the right lender. Today, with financial institutions offering online services, home loan apply online process has become easier than ever before. When you apply online, you can compare the offers from different online and make an informed choice.

Know your eligibility

Different lenders have different eligibility criteria, and while choosing the lender, you must ensure that you meet their specific requirements. Generally, the lenders have the following criteria:

• You must be a resident Indian.
• You must be aged between 21 to 65 years at the time of applying for the loan.
• For loans up to 30 lakhs, the maximum loan you can get is 90% of the property’s value. For loans between 30 lakhs to 75 lakhs, you can get up to 80% of the property’s value.
• You must have a stable source of income.

Be wary of the charges involved

When you apply for a home loan, you are liable to pay several charges, apart from the interest rate. And one of the most significant costs is the loan processing fee.

While the processing fees vary from lender to lender, the lenders mostly charge up to 0.50% of the amount borrowed. Besides, you must also incur other charges such as property evaluation fees, pre-payment charges, documentation charges, etc.

Make sure that you compare the charges from different lenders and choose the one that has the lowest fee as it would help you reduce your overall loan cost.

Take advantage of the PMAY benefits

The Pradhan Mantri Awas Yojana is an excellent government initiative that offers interest subsidy for home loan applicants. Ensure that you check your eligibility for PMAY and apply for a loan under the relevant category and get the benefit of interest subsidy. This not only helps you reduce the interest burden but also makes repayment easier.

Final Word

Buying a home in 2021 requires proper planning and being meticulous with your finances. Ensure that you review your finances well to fund the purchase and the repayment of the loan and avoid taking any decisions in a rush.