Home Loan Types

Choosing the right type of home is very important to help you with your savings and also minimize the burden of giving high interest.

There are many banks and NBFCs ( Non-Banking Financial Institutions) that provided loans according to the requirement of every individual in India.

If you are searching and want to apply for a home loan, here is the list of different types of home loans you can choose from.

Types of Home Loans You Can Avail In India

1. Loan For Buying New Home.

This type of home loan is the most common and taken by most people in India.

You can avail of this home loan to buy a house,  for a newly built one or for old construction.

You can avail of this type of home loan for up to 80% to 90% of the property value.

The home loan amount can be in Crores depending on whether you meet the eligibility criteria which depend on your income, EMI ratio, Cibil, etc.

2. Land Purchase Loan.

Many banks and NBFCs offered loans for purchasing land. 

The land purchasing loan does not cover the cost of construction. You can avail of this loan if you have enough funds to bear the construction costs.

You can also resell it to someone for a good profit after keeping it for some time, at least for a year, or until you get an offer for a good profit margin.

3. Home Improvement Loan.

A home improvement or home renovation loan is will allow you to modify your home according to your convenience.

The loan amount will depend on the estimated renovation cost for which you are eligible.

4. Home Construction Loan.

Not all banks offer a home construction loan. The home construction loan can be availed only if you already own a plot in your name and are looking for funds to meet the construction expenses.

Your home construction loan will depend on the estimated construction cost you submitted to the bank.

You can take this type of loan from SBI, HFDC, PNB, Canara Bank, Bank Of Baroda, and DHFL Home Construction Loan to name a few.

5. Home Extension Loan.

You can avail this type of loan when you want to add extra space to your own home like adding another room, balcony, bedroom, etc.

The loan amount will be is decided based on the cost of the alteration as well as the construction of a new room.

6. Bridge Loan.

A bridge loan is a short-term fund that comes in handy when you are in need of funds to buy a new house while trying to sell your existing house.

With the bridge loan, you can give the down payment and then repay your loan as soon as your existing house is sold.

NOTE: I am not a professional in this field nor am I an agent. I put up this article to help you gain a better understanding of your available options as I was facing problems while applying for home loans.

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