to Choose a Housing Finance Company
Choosing the housing finance company (HFC) is a
crucial stage in the home loan process. It is imperative to choose
the financer with utmost care and proper consideration of its past
track record since the customer is entering in a long-term
relationship with the HFC when he takes a home loan.
The task becomes all the more difficult when one takes into
account the burgeoning housing finance market in India. Besides
the 32 NHB-recognised HFCs, the nationalised banks have also made
housing a priority area and added the housing loan segment to
their existing category to reach the individuals. In such a
scenario, one needs to exert caution while zeroing in on the home
Apart from issues such as interest rates, repayment period, home
loan agreement and eligibility, customers need to check the hidden
costs that may come from the housing finance companies. Prepayment
penalty is undoubtedly one of the most expensive hidden costs
encountered by borrowers. Home loan companies that charge this
penalty should be avoided if one expects to prepay the loan due to
increased cash inflows in near future.
Moreover, most Companies do not pay for the technical valuation
report of the property while others insist on a registered
mortgage that will increase costs of taking the loan. The onus is
on reading the fine print in the loan document and seeing through
the maze of exciting offers.