A loan can be taken to buy or construct a home. It can also be granted to enhance the property. This loan is granted by the banks or finance companies. This loan is granted against the property. In case, you are unable to repay the loan, the lending bank has all the rights to seize or to take possession of your property/ home.

Some useful Terms

Types of Home Loans

• Home Purchase Loan
• Home Improvement Loan
• Home Construction Loan
• Home Extension Loan
• Land Purchase Loan
• Balance Transfer Loan
• Refinance Loan
• Loans for NRIs

EMI

EMI or Equated Monthly Installment is the minimum amount that has to be paid against the loan every month. It consists of a portion of the interest as well as the principal. This amount is paid till full payment of the loan is made.     

Fixed Rate of Interest

In this, the rate of interest is fixed which ranges from 8.75% to around 12 %.

Floating Rate of Interest

The Rate of interest is not fixed & it vary depending upon the policies of the issuing bank.