Checklist for Choosing a Home Loan Provider

Most people purchase a house only once during life, and it is an extremely crucial and tough decision. The primary concern during this process is the arrangement of finance. With many banks and Non-Banking Financial Companies (NBFCs) ready to offer home loans at competitive interest rates and various benefits, this concern is alleviated to some extent. However, there are some dynamics related to the banks and NBFCs that must be comprehensively assessed before pinning down the final lender. Following are some of the important dynamics that must be evaluated:

1. Lender's existence and performance: The lender must be an established bank or NBFC and not a new set up. The borrower must find out about the historical performance of the lender.
2. Lender's reputation and knowledge/skillset: It must be assessed whether the lender holds goodwill in the market. In addition to this, the lender should be informative in terms of industry and market trends in the housing sector. Also, the lender should be able to simplify the loan procurement procedure.
3. Augmented services: Apart from offering funds, the lender should be capable of offering augmented services like the selection of appropriate housing schemes, negotiations with the developer, a detailed understanding of all the facets of the home loan process and extracting complete advantage of subsidy and financial assistance offered by the government.
4. Offerings: The product range of the lender might include various types of loans for the same property, like loan against property, loan for home enhancement, top-up loan, etc.
5. Supplementary services: The lenders can offer supplementary services in the form of digitization of the entire loan procurement process. This will not only save time but also reduce hassles for the borrower. Also, the borrower will be given online access to his/her loan account.
6. Trustworthy: The lender's past should be indicative of its legitimate transactions and moral principles. This is to ensure the privacy of the borrower’s information and complete security of original documents submitted by the borrower at the time of procuring the loan.
7. Customization: Since a home loan is a long-term instrument, the lender should be able to offer customized repayment plans. A personalized Equated Monthly Instalment (EMI) scheme for every borrower should be formulated for their benefit.

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.