How to Choose Best Bank before Taking Home Loan
Property is a thing in itself and from the earlier times, till recent times will remain as the most important asset ever taken by any person and possession of it is important for ones living in society. However, Urbanisation make the prices of properties skyrocketing due to which borrower have to take the loan as the finances available with current job did not suffice to make a purchase. These days, a different bank offers different types of loans and facilities to match up borrower’s requirements. Home loan is one such type. Home Loan is a financial burden and before taking home loan borrower need to have the information of his annual income, including any overtime and commission, details of debts and expenses, such as other loans and debit cards and then has to think wisely to decide the amount as well as the bank from where one make up mind to apply for the same. Due to demonetization and reduction in lending rates offered by banks, interest rate competitions among banks hots up due to which employees working in banks resort to various tricks to woo and befool the customer by not disclosing of the long terms expenses and charges hurting their emotions impacting their finances in a big way which they can’t afford in the future during the closure of their loan Hence, Below mentioned are the important points to be considered for finalising the bank for taking loan:
- Industry Status to Real Estate Sector: The government must increase the tax exemption limit on interest and principal repayments for home loans which eventually will incentivize first-time buyers. This will give industrial status to Real Estate industry which will boost demands for funds in the local banks. As more and more customers are interested to avail the loan facility while purchasing their properties.
- Single Window Clearance to Real Estate Industry: The Union Minister Mr Arun Jaitley should focus on simplification of norms on Real Estate Investment Trust so as to give the Single Window Clearance to Real Estate Industry which will boost the demands for home loans further increasing the buying capacity of home buyers and preventing from causing unnecessary delays in delivery of a project and also bring down the price by 20 to 25 % making them more affordable.
- Clarity on Beneficiaries under Pradhan Mantri Awas Yojana: Budget 2017 should provide more clarity on the actual definition of beneficiaries who all can avail the benefits. For those who do not belong to economically weaker section can able to get subvention benefits while purchasing their LIG properties.
- Financial Security from delays: The government should focus on extending tax rebates in cases where projects delayed due to bonafide reasons. All these steps will help the government to move closer to the dream of housing for all by year 2022.
- I-T sops for first-time home buyers: The government should focus on providing similar tax incentives for the first timer buyers as being providing into tier II, III cities few days back like for those interested in buying a house worth Rs 50 lakh will be getting exemption of additional 50 lakhs with a loan up to 35 lakh. Also need to be applicable in metros or a higher limit specific only to bigger metro cities should be introduced. There is also a dire need of the government to take such steps by which affordable projects to get additional tax incentive for at least 5 years which help even the common man to have their own house and to keep themselves away from their rented accommodations.
- Simplified tax norms for REITs: The government should consider convincing the states to exempt Real Estate Infrastructure from stamp duty, registration charges that will also help in functioning, implementation of RERA. Government needs to provide adequate financial and regulatory resources to support these measures.
- Higher tax saving on home loan & home insurance premiums: The government should focus on increasing the tax deduction limits so as to increase the demand and supply especially in metropolitan cities where the cost of propitiate Also there has to be tax concessions on house insurance premiums to encourage homebuyers.
- Clarity on GST: The government should focus on providing the clarity on GST (Goods and Service Tax)which need to be fixed at a rate which must be in lower possible slab of GST(goods and service tax) to the affordable home buyers in order to enable greater affordability for potential home buyers. Clarification is also needed on the abatement scheme, whether credit for input tax would be allowed if the composition scheme has been availed by developers.
- Increase in Rent Deduction Limit: The government should also focus on increasing the Rent Deduction limit so that homebuyers can save money to provide the EMI of his monthly loan without worrying. One should focus on increase the tax deduction for amount paid on housing loan from 2 lakh to Rs 3 lakh.
- Digitization of all land records: The government should focus to make all records related to land and registration process digital to make them easy to do and transparent.
Conclusion: We can conclude by saying that stakeholders have higher hopes from the forthcoming budget which need to fulfill all the above expectations enabling to provide the opportunity to common man to have housing of his own by availing home loan facility