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Buying your first house is a large milestone, and it is important to ensure that you are financially and mentally prepared.
Buying a house
Buying a house is one of the most important financial commitments. It only represents more than the ownership of the property; It is a long -term investment and an individual milestone. For homebuilders for the first time, the process needs to consider various factors to ensure that the decision align with financial stability and future aspirations. The decision is about understanding your financial readiness, long -term stability and real estate market complications. In India, with your dynamic economy, transfer of government policies, and sometimes developing tax structures, knowing that when you are ready to take a dip in the owners of the house, careful consideration is required. .
1. Do you know what kind of financial commitment is in home ownership?
The first and most important step towards the owners of the household, is making sure you have a stable income. In India, home loan eligibility is usually based on your monthly salary or income. Financial institutions usually provide loans up to 80–90% of the property value, but your monthly EMI (equal monthly installment) should not exceed 40–45% of your income so that you can maintain a healthy financial balance.
For example, if your monthly income is 1,00,000, your EMI should ideally not to exceed 40,000 to ₹ 45,000, based on your debt eligibility.
Additionally, assess whether your current income can support your other expenses (eg current debt, personal expenses and savings), while still maintaining a comfortable lifestyle.
2. It is not just the cost of a house, there are other things too!
In India, home loans typically cover up to 80–90% of the property value. The remaining 10-20% is your down payment, which you have to pay the upfront. Ideally, you should save at least 20% of the property price for down payment. For example, if the house you are keeping an eye on is ₹ 50 lakh, you will need ₹ 10-12 lakh for down payment.
Beyond the down payment, you should also have different money for additional costs, such as:
● Stamp duty and registration fee: They differ by the state, but are usually 6-7% of the property value.
● Home inspection and documentation fee: Title verification, legal advice and fee can add fees for inspection.
● Internal decoration and renewal: If you are buying a resale house, the cost may be included in preparing the house.
3. Have you taken into account your current loans and loans?
Before being committed to long -term loans like home loans, it is necessary to evaluate your existing financial obligations. Existing loans – such as credit card loan, personal loan, or auto loan – can under stress and reduce your ability to pay home loans comfortably.
When approved the loan, the lenders consider your loan-to-income ratio. A high existing loan load can obstruct your debt approval process or affect you eligible loan amount. Ideally, you should clean or reduce high-onion loans before applying for home loans.
4. Is your credit score home-loone ready? Why does it matter here!
In India, your credit score plays an important role in achieving a home loan and affecting you the interest rate introduced. A credit score above 750 is usually considered good by most lenders, and this can help you qualify for low interest rates. A strong credit score shows that you are responsible with the management of the credit, which assures lenders in your ability to repay the loan.
If your credit score is below 750, consider working on improving it by cleaning the outstanding loans, paying credit cards, or reducing any pending loan before applying for a home loan.
5. Do you know that home loan is a recurring EMI for not less than 10-20 years?
In India, especially in major cities like Delhi, Mumbai, Bengaluru or Pune, there is a long -term commitment. You need to ask yourself whether you are ready to settle in one place for an extended period. Typically, it takes about 7 to 10 years to recover the cost of a house and begins to see an increase in its value, especially in metropolitan areas.
If your job needs transfer or you are uncertain about your future plans, this may not be the right time to buy a house. Renting can be a better option until you become more systematic.
6. Are you maximizing your home loan tax benefits?
Income Tax Benefits: Under Section 80C of the Income Tax Act, you can claim a deduction of up to ₹ 1.5 lakh on the major repayment. Additionally, Section 24 (B) Home loan allows a deduction of up to ₹ 2 lakh on interest payment. These tax benefits can reduce financial burden and make the homeowner more cheap.
You should also be familiar with stamp duty and registration fees, which vary from state to state. Some state female buyers offer cuts, so if you are a woman buying a property, check if any discount applies in your state.
7. What are other hidden factors that can make or break your property investment?
The Indian real estate market is diverse and may be difficult to navigate. Whether you are buying in a metropolitan city or in a small town, research is important. Understand the trends in the local market, the appreciation capacity of the area you are interested and upcoming infrastructure projects that can affect property values.
● Current market status: Is the market currently a buyer’s market (more supply than demand) or a seller’s market (high demand and low supply)? Knowing this will help you interact on a better price and will help avoid paying more than property.
● Future development plans: Check any planned infrastructure projects like metro rail expansion, new highway or commercial hub. These can significantly increase the property price over time.
8. Can you spend more than just EMI?
The homeowner is not only about paying hostage. As a homeowner, you will be responsible for the maintenance and maintenance of the property. This includes repair, maintenance costs, payment of property taxes and dealing with utility bills.
Ensure that you have the financial ability to handle these expenses without increasing your budget. Consider creating a fund for the cost of future repair and maintenance, as they are indispensable over time.
conclusion
Buying your first house is a large milestone, and it is important to ensure that you are financially and mentally prepared. It is not only about saving for down payment or acquiring home loans; It is about to ensure that you have a long -term stability, a clear understanding of your financial health and your responsibilities as a homeowner. With a stable income, with a major loan, a good credit score, and intensive understanding of government schemes and market trends, you will be well with your own way of making a sound decision on homebuilding in India.
Taking time to assess these factors will help you avoid possible damage and will ensure that buying a house is a rewarding and financially sustainable decision.
Written by – Amit Aggarwal, CEO and Kofounder of Nobroker
The ideas expressed in this article are of the author and do not represent the attitude of this publication.
