COVID Crisis: The Four Best Ways to Reduce Your Home Loan EMI Payment

With the Covid-19 induced lockdown affecting cash flows, making regular loan payments has become challenging for many people. For those who have taken home loans where the EMIs are high, this challenge becomes tougher. As a borrower, if you are looking for ways to make your home loans easy by reducing your EMI payments, follow the tips given below.

 

Change your lender:-

It is incredibly easy to shift lenders, and all you need to do is approach your current and new lenders and request a swap of the loan balance.

While taking a loan, choose a lender, who provides a low home loan interest rate. If you have now found a new lender willing to pay considerably lower interest rates, consider changing your mid-credit loan. And if you can't find a lender with a lower interest rate on home loans, you can try one willing to extend your term on repayments. Before you change lenders, use an online home loan EMI calculator to know precisely by how much your EMIs can go down.

Pre-payments help:-

Previously loan pre-payments had come with lots of fees. However, most NBFCs & HFCs such as Shubham Housing Finance and many other housing finance companies don't take pre-payment, enabling borrowers to repay substantial amounts of their home loans before the tenure ends. If you want to lower your EMIs and the amount of interest paid, prepay online, or offline your home loan at the beginning of your repayment tenure.

Make a bigger down payment:-

A higher down payment reduces the amount of the principal loan, which means that the interest payable and the EMI charged also decrease automatically. If you have some extra savings, you can use while apply for a home loan to make a substantial down payment.

Choose longer tenures:-

If no other option works for you, extend the tenure of your home loan. With a longer-term on loan repayment, you'll have to pay more interest, but your EMIs will come down dramatically. Negotiate with your lender to prolong your term on repayments. Determine the exact amount of interest you will pay using an EMI home loan calculator before you make this decision.

 

Before selecting a lender, read the home loan eligibility requirements for tenure extension, refinancing, or pre-payment. Using clever financial planning and pounce on opportunities for EMI reduction whenever possible.

  

However, be wary about EMI reduction methods which require higher interest payments on home loans. You can easily apply for a home loan with reduced housing loan EMI burden with proper preparation, and keep your savings secure for emergencies.

What To Do If My Home Loan Application Gets Rejected?

Owning a home is one of the significant moments of our life. A home is a pride that we feel when we own our own home.

 

Buying a home gives a sense of security but also impacts your long term financial goals. After all, not everybody can purchase a home with available cash or bank balance. This is where you need to finance your home with a home loan.

 

Here, let us understand why your loan application was rejected to proceed with the rectifications. Once you know and rectify them, it becomes easier to avail of high-value loans with easy-to-meet eligibilities.

 

Shubham Housing Development Finance Company provides loans to those who are earning cash income. All you need to check is the eligibility criteria and documents.

However, a rejection of loan application may be a result of several reasons.

· High debt-to-income ratio.
· Property value not high enough for the applied loan amount.
· Previous defaults
· No proper documents

Here are some of the reasons how to narrow that gap to boost the odds of approval when you apply for the loan.

1. Identify the Cause of the Denial

It's important to find out why your loan application was rejected. Ask the lender about why your home loan got rejected as the lender will generally be glad to give you an explanation and are required to provide certain disclosures. This will help you to reapply for a home loan.

 

2. Pay Off Any Outstanding Debts

Paying off your outstanding debts reduces your debt-to-income ratio and thereby increases your repayment capacity.

3. Mortgage A Property Of High-value

If you own several properties or planning to mortgage a property, always remember mortgage a property that has a high market value. It not only increases your chances of availing but also fetches you a high amount of Loan.

4. Build A Strong Credit Score

 

Building a credit score is a long-term initiative, and by paying bills on time you can build the score high and also increases your chances of loan application approval.

5.Lower your home loan amount

If the reason for rejection is your monthly income, then try to lower your home loan amount, this will help the lender meet the bank's prescribed norms within limits.

6. Any documents if missing

Take legal advice if any important property paper is missing. There is always a solution to a missing document. No lender wants to lose a customer. At Shubham, we always ensure to help you determine the right loan for you.

If you've any more queries, do let us know, we are here to help you.

How To Avail Loan Against Property Without Income Proof ?

 

Almost every one of us has had a financial crisis in our life at one point or another. As in such crucial times, we often think about where to finance or borrow the required amount of money on an urgent basis. During such times, your property can help you fulfil your needs and aspirations.

People take a loan against property for many reasons like to expand their business, education, study abroad, take a vacation, or for medical treatments.

Suppose you have a property registered under your name, then you can approach the lender asking for a loan against your property. The lender will assess the market value of your asset and will sanction the loan if the title is clear.

But the most crucial thing is that even if you submit your property documents as collateral still most of the leading banks in India will ask you for income proof as it determines the repayment capacity of the borrower.

However, if you do not have a formal income proof needed by banks, there is no need to worry. As now there are few housing finance companies such as Shubham housing finance, Aadhar housing finance, Awas housing finance which provides loans to the individuals who earn in cash income.

Generally, banks will not provide you with a loan if you are getting salary by cash, you are in a business where sufficient income proof is not available like small shopkeepers, suppliers, or any other profession.

Here in this article, we will discuss everything you need to know of availing a loan against property without income proof.

Keep the following factors in mind to avail loan against property without income proof. Read on to know more.

#Clear all your dues on time: 

If you own a credit card and pay all your dues on time, then you are likely to get an approval for the loan instantly without submitting any income proof. Clearing off debts not only helps in lowering the interest rates but also reduces the debt burden.

#Maintain a good credit score:

A good credit score gives the lender a sense of assurance regarding timely payment of EMIs from your end.

Remember, a low credit score can lead to loan rejection or approval at a high-interest rate. On the other hand, having a good credit score makes you eligible for affordable loan interest rates and other beneficial terms with the lender.

# Keep a Check on your Savings: 

Maintaining an excellent monthly balance along with regular savings improves the chances of getting a loan against property approved.

#Justify your income to your representative: 

In case of lack of income proof or ITR, you must specify your income source and why you do not have the necessary documents. Always make sure to provide the information in detail because the final decision is likely to depend on the information you provide.

#Apply with a Co-Applicant: 

Assigning co-applicant increases the chances of your loan approval quickly. If your mother, father, brother, son, spouse, or unmarried daughter is an earning member with valid income proof, you can avail home improvement loan with the co-applicant. In such a case, lenders will consider the repayment capability of your co-applicant while determining loan interest rates and the loan amount.

#Opt for a Lower Loan to Value: 

A loan to value is the percentage of the property’s market value offered as a loan by the lender. It is less of a risk for the lender, and for the borrower since less is being borrowed. Making higher down payments and availing a lower LTV improves your chances of getting the loan approved without income proof, and it posits positive borrower credibility.

#Provide income proof from other sources:

If you have an informal source of income such as rental income, fixed deposit interest income or income proof of any family member, then you too can stand a chance to get your loan approved.

Consider these pointers to avail the Loan Against Property at an affordable interest rate from Housing Finance companies like Shubham Housing Finance who are there to help people with informal income streams.  

Can You Get a Home Improvement Loan With No Income Verification?

Borrowing money without having an income proof is now possible. Many people think that it’s a daunting task to borrow money without proof of income because lenders want to know how much you’re earning.

There are numerous housing finance companies such as Shubham Housing Finance, Aadhar Housing Finance, Awas Housing finance, and many more that provide loans with no income proof. However, you may have to face things like high interest and short repayment periods. 

Understanding what your requirements and improving your credit score will enable you to get a decent loan without paying too much.

Keep on reading to learn how you can get a home improvement loan with no income verification:

#Clear all your dues on time:

If you own a credit card and pay all your dues on time, then you are likely to get an approval for the loan instantly without submitting any income proof. Clearing off debts not only helps in lowering the interest rates but also reduces the debt burden.

#Establishing a good relationship with your lender: 

Maintaining a good relationship with the lender is a wise strategy. Nurturing a healthy relationship with your lender increases the chances of your loan approval.

Trust goes a long way towards reducing the perceived amount of risks. The lender will need reassurance, especially if it is the first time working with you. They need to know they did the right thing by investing with you.

#Elaborate your income to your representative: 

In the case of lack of income proof or ITR, you must specify your income source and why you do not have the necessary documents. Always make sure to provide the information in detail. Because the final decision is likely to depend on the information you provide, thus determining your annual income as well as repayment capacity.

#Apply with a Co-Applicant: 

Assigning co-applicant increases the chances of your loan approval quickly. If your mother, father, brother, son, spouse, or unmarried daughter is an earning member with valid income proof, you can avail of a home improvement loan with the co-applicant. In such a case, lenders will consider the repayment capability of his/her co-applicant while determining loan interest rates and the loan amount.

#Improve Your Credit Score If Possible: 

A good credit score gives the lender a sense of assurance regarding timely payment of EMIs from your end. Remember, a low credit score can lead to loan rejection or approval at a high-interest rate. On the other hand, having a good credit score makes you eligible for affordable loan interest rates and other beneficial terms with the lender.

Anyone that’s looking to get a no income verification loan will need to improve their credit score because lenders will be relying on it to determine your financial eligibility.

 

If you don’t have an income but have a high credit score, lenders will be more confident in you paying back the loan than they would if your score is low and you don’t have income.

 

If you require one, you can start looking at these housing finance companies to see what options they offer. Consider these pointers to avail the loan at an affordable interest rate to repay them with ease. We encourage you to start building your credit score before applying for a loan. This will allow you to get loans with better terms and you might even be able to borrow more.

5 Smart Ways To Manage Your Home Loan

Are you planning to apply for a home loan or already paying a home loan EMI? 

Well, if your answer is yes, then you need to evaluate your ability to repay the debt carefully.

A home loan is probably the most significant financial commitment, and you need to know to manage it well.

Though it is a smart way of converting your wish into reality, without digging much into your savings, when it comes to paying the home loan EMI, it isn't always an easy task.

Here are five ways that can help you manage your monthly EMI efficiently.

1. Pay a higher EMI if you can: 

Paying a high EMI can help you manage your home loan better. You might be thinking, how is it possible for you? 

Opting for a high monthly EMI reduces not only the loan tenure but also reduces your financial burden. So paying off home soon is the best way out to make way for other crucial things in life.

2. Manage your funds properly: 

While dealing with loans and investments, compare your monthly payments with monthly returns. For instance, if you find that certain investments are not giving enough returns, it is better to close those and clear the funds towards the EMIs of your home loans. 

3. Partial pre-payment:

A partial pre-payment lets you reduce the tenure of your existing home loan, EMI, or both as per your financial requirements. It will also provide you with a clear and better understanding of the savings you will have.

You could use those incomes to prepay your Home Loan. For instance, if you got a promotion recently or one of your Fixed Deposit just matured, you could use those funds and prepay your loan to save yourself from loan obligation and also reduce the loan tenure at the same time. 

4. Get the math right:

Do you know about the being of loan calculators? Don't worry! We are here to help you. 

You can check the monthly payments of your loan with the help of an online EMI calculator. Shubham Housing Finance helps you to understand the loan more efficiently and conveniently.

These calculators can help you understand what loan amount you can need to sustain. The best part? They are simple, convenient, and easy to operate. 

Calculating the EMI in advance helps to know the amount of money to be kept aside every month, helping you to manage your finances better.

What's better than getting to know everything about your monthly loan payments, cash down payments, and interest rate?

Since Home Loan EMIs are a critical part of your monthly budget, you essential be able to balance all your other financial commitments as well.

5. Do not miss your monthly payments:

Skipping or missing your monthly instalments will not only pull out the surplus cash from your fixed budget but also affect your credit score. Always ensure that you don't get the tag as the Special Mentioned Account (SMA). You must assess your appetite for loans and not take a new one till you have repaid the older ones.

If you have any more queries, do let us know in the comment section below.