Basics of a home loan

“Home is where the heart is”, a place that gives you emotional and spiritual warmth. The rising real estate prices have made buying a property a daydream for most of us. Home loan is a way that will bring you closer to your “dream home”.

Types of Home Loans

You can avail if for Home construction, Buying a ready built house/apartment (from developer or resale property), Residential lot, LAPetc.

Types of Mortgage Rates

The loan rate usually depends on the amount of credit you want to take out. Here, too, it depends on the type and term of the loan. Banks will offer you a fixed or variable rate option.

Fixed rate It allows for repayment in fixed equal monthly installments (EMI) over the life of the loan as it does not change with market fluctuations. But essentially this is not the case. All banks include a fixed rate reset clause in their home loan contract documents, which makes it clear that the bank may change the interest rate even during the term of the contract due to unforeseen changes in money market conditions.

Variable rate It refers to the interest rate that depends on the market and varies depending on the country’s economic situation. At any time during the term, a customer may prepay a portion of the loan or repay the entire loan based on the appropriate lender norms.

documents required

  • An application form duly signed by the applicant
  • proof of age
  • proof of identity
  • proof of address
  • income documents
  • bank statements
  • Employment Details
  • Evidence of education (if applicable)
  • Property details (if completed)
  • A processing fee check

handling fee

It is a non-refundable fee that is normally charged by all banks for each home loan application. This varies from bank to bank and is usually between 0.50% and 1% of the loan amount.

Home loan eligibility

A person’s income justifies his eligibility loan amount. However, banks have their own set methods for estimating eligibility. The loan term and the interest rate also play an important role in calculating the loan amount. A good employment and repayment record increases the likelihood of getting a home loan. Customers meet the level of utilization of the best rates depending on their profile, income, turnover, repayment history, builder profile, etc.

How much would the bank finance?

Banks usually finance 80% to 90% of the market value as a loan. The customer must first make a down payment (difference between the actual property costs and the loan amount) himself. Banks sometimes even fund registration costs and stamp duty as part of the home loan.


All leading banks like ICICI, HDFC and others cover the loan with insurance to protect the family from loan liabilities in case of unfortunate demise of the borrower.

At Moneylaxmi we help you to realize your dream of owning your own home. We’ve tied knots here with ICICI, HDFC, Citibank, Standard Chartered and Axis Bank to ease the hassle and support clients with the most fit-for-purpose home loan plans. We guide you with attractive interest rates, simple documentation, fast processing and transparent information.