What Is a Flexi Hybrid Home Loan & How It Works

Getting a home loan is a huge financial commitment. Since it involves a high amount, it is paramount that you choose the right kind of loan to manage the repayment without any hassles or compromising on your other long-term goals.Today, many lenders in India offer a wide range of home loan solutions with unique features and benefits to suit the different needs of different borrowers. One such popular home loan variant is the Flexi Hybrid Home loan. It offers many benefits, apart from providing a high loan amount up to Rs. 5 crores at a low interest rate.

1. Flexible repayment terms One of the most significant benefits of taking a flexi hybrid home loan is that you manage the repayments efficiently. For the first four years, you must only repay the interest and not worry about repaying the principal amount during this period. This gives you sufficient time to organise your finances and easily plan future repayments.During the interest-only repayment period, you can save a significant amount and use the money to invest and earn valuable returns. After the initial period, the EMI amount will increase marginally as you start repaying both the interest and the principal amount.
2. Prepayment benefits When you avail of a Flexi hybrid home loan, you can enjoy unique prepayment benefits that you don’t get with any other type of home loan. Typically, when you make a part prepayment, you essentially pay off the principal amount. This means your overall loan amount and tenure may reduce.However, the principal amount does not decrease when you make a part prepayment in a Flexi hybrid home loan. Instead, the lender sets this amount aside. You can take an additional loan equal to the amount you prepay at a very low interest rate during the loan term.And, once your total outstanding amount is equal to the amount you have prepaid, the lender will close the loan account prematurely. Thus, you can benefit from additional funds at a low interest and pay off the loan quickly.If you don’t avail of an additional loan, the lender uses the amount you have prepaid and the interest you repay to close your loan before the actual term.
3. Easy eligibility requirements When you apply for a home loan, the chances of getting your loan approved depends on whether you meet the lender-specific requirements. Typically, the lenders have a specific list of eligibility criteria, and if you fail to meet any of them, the chances are high that the lender will reject your application.In contrast, when you apply for a Flexi hybrid home loan, you only must meet two criteria to get the loan sanctioned. Firstly, you must be aged less than 50 at the time of applying for the loan. Secondly, the property you want to buy must not be under construction.If you match both the requirements, you must submit a few documents and the home loan application form and get your loan sanctioned.
4. Complete online management of your loan account This is another significant benefit of taking a flexi hybrid home loan. You can monitor and track your loan-related transactions online. This helps you avoid the hassles of constantly visiting the lender’s office or getting on a call with the representative.When you apply for this loan, the lender creates unique login credentials for you through their portal. You can log into the portal anytime using your ID and password and access any information you want, such as the total interest amount you have repaid to date, the total outstanding amount, etc.You can also use the portal to raise service requests, such as getting a hard copy of the home loan statement.
5. Other value-added features Apart from getting a high loan amount at competitive interest and flexible repayment terms, you can enjoy other value-added benefits with a Flexi hybrid home loan. For example, you can use a property dossier service to understand the financial and legal aspects of purchasing a home.Similarly, you can opt for home loan insurance and even customise it to your specific needs. Getting home loan insurance is an excellent way to protect your family members from repayment burden if something unfortunate happens to you during the loan term.

The flexi hybrid home loan is an excellent way to get the funds for home purchase; it makes home buying easy. With unique features and benefits, you can effortlessly manage the repayments.

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.