Home Loans without Risk

Introduction:  When looking for the best loan, there are certain terms you will need to be familiar with. The fixed rate loan will keep the same interest rate and monthly repayment for the whole lifetime or term of the loan. This will generally be for a period of 10, 15, 20 or 30 years. If the rate is fixed for a period, such as the first 2 or perhaps 5 years, and then reverts to a variable rate it is known as an adjustable rate mortgage or ARM.



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Can I get home loan without a home? Some banks have conditions such as construction of house should commence within six months.

If I take a home loan to buy a plot of land and construct on it (site + construction), will I get tax rebate on the total EMIs (EMI for site + construction, or EMI for construction only)?

If you are buying a plot and constructing your own house, then banks will always stipulate a time limit for commencing the construction of the house.

The reason is that the banks may not want to fund the buying of a bare plot.

Even if they were willing to provide a loan for a plot of land, it may come at a higher cost and not at the home loan cost which is considerably cheaper than a plot loan.

If your intention is to build your own home, you should not have a problem with the time limit.

If, however, you want to buy a plot with an indeterminate plan to build a home sometime in the future, then you should seek a plot loan rather than a home loan.

Tax benefits on a land loan

The tax breaks are available on the full loan amount (site + construction) from the year in which the construction of the property is completed.

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Home loans without a Risk

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