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Knowing the Positives and Negatives of Opting for Home Loans

Knowing the Positives and Negatives of Opting for Home Loans

  • By Saral Credit
  • June 29, 2022

For most Indians, taking home loans is the last resource to make their homeownership into reality. Financial advisors consider home loans necessary to maintain a fund for future contingency purposes. After residing in a metropolitan city, buying a home with savings only is quite challenging.

Not only that, but it also has some downsides. For those who first buy homes, it is worthwhile to rely on home loans to prioritize other commitments. Take a deep insight into the blog to find out both upsides and downsides of choosing home loans.

The Usefulness of Home Loans

Some individuals stay a little stressed thinking about the payments of EMI, although home loans come with some significant perks, as follows:

Makes You a Dream Come True

With the elevated price of land and building components, it's next to impossible for some individuals to finance buying a home. But, if you have a lifetime dream of owning a dream home, you can fulfil that by relying on home loans.

A home loan is the last resort to help you become a proud owner. When self-financing seems a little costlier, a home loan allows arranging funds at a more economical cost for building your asset. If you are stressed about availing of home loans, don't worry! Multiple lenders are available in the market, waiting to offer your home loans attractive offers.

Helps Save on Pocket

Most people become afraid of committing to pay out debts. Thus they stay away from taking loans. Although, getting access to loans helps you from wasting money on rent payments. From a light perspective, rent seems affordable, but it becomes an economic mislaying without experiencing ownership.

Additionally, renting also consists of annual hiking, which can be a headache for middle-class salaried persons. Therefore, paying out EMI for your owned home is more advantageous. This way, you can easily have the property in your name within twenty years.

Allows Tax Deductions on the Paid Interest

When you decide to take a home loan, you are more likely to enjoy the tax benefits. The interest you are paying on the EMI in a year can be deducted from your aggregate earnings, i.e. up to 2 lakh. If you take a home loan at the pre-construction stage, you will also be allowed to tax deduction against the principal of the EMI in a year. You can also get deductions on the registration charge and stamp duty.

Long-lasting Financial Obligations

When you consider the repayment period, you will understand that a home loan is a prolonged financial obligation that must be met. While personal loans can be repaid within two years, it takes 20 years to pay off the home loan and interest. If you are not disciplined daily, paying out the timely EMI for the next 240 months will be extremely difficult to continue.

When you take the biggest financial decision of your life, it must be completely satisfying to have it in life. Understand your financial status and check with the different lenders to know the possibilities of securitization of your asset. Grab the home loans today only for owning your seventh heaven.