Want To Reduce Your Home Loan Interest Rates? Try Using These 5 Tips!
Every
borrower looks for avenues to the reduce interest rates applicable on his/her home loan. However, what they’ll
find that this is much easier said than done. Fortunately, one can make use of
the tips mentioned below to unlock lowered rates and higher savings on their
home loan.
1. Negotiate.
The first tip is obvious but some borrowers are just too shy to ask and if you don’t ask, you won’t receive! You need to remember that asking is not going to hurt anyone; neither is negotiating and bargaining a little. Of course, you’ll need some leverage to back your demands. For this, you can look to your credit score, especially if it is in excess of 750 or 800. If it isn’t, you can try working on it before applying so you have some bargaining power when you do apply. You can also add a co-borrower who has their own source of income to try and negotiate lower rates.
2. Provide larger down payment.
If possible, try and put down more money. Often lenders decide rates on the home loan slab you fall into. Saving more and borrowing less could put you into a lower loan slab and thereby fetch your correspondingly lower rates.
3. Add women co-borrower.
This is the easiest way to get lower home loan interest rates. All you have to do is add a woman co-borrower you to application. Wondering how this will result in lower rates? Well, it’s simple – most lenders consider women as safer borrowers and therefore provide them a concession on normal housing loan interest rates.
This concession is usually a discount of 0.05% on the rates applicable for men. At first glance, this might seem like a miniscule reduction but you have to look at the big picture. Imagine a 0.05% saving on lakhs of rupees on your monthly EMI for up to 25 years? It takes drops you create an ocean and that what you’ll end up with by the time your tenure is over – an ocean of savings!
4. Refinance.
Some borrowers think they are stuck with poor rates since they have already borrowed a loan from a certain lender. They irk at the sight of promotional messages that show advertise home loans at lower rates. However, the good news is that, you can switch over to lenders who are providing better rates at any time. The process is called home loan balance transfer. It entails transferring your outstanding loan amount to a new lender to enjoy lower rates on offer.
1. Negotiate.
The first tip is obvious but some borrowers are just too shy to ask and if you don’t ask, you won’t receive! You need to remember that asking is not going to hurt anyone; neither is negotiating and bargaining a little. Of course, you’ll need some leverage to back your demands. For this, you can look to your credit score, especially if it is in excess of 750 or 800. If it isn’t, you can try working on it before applying so you have some bargaining power when you do apply. You can also add a co-borrower who has their own source of income to try and negotiate lower rates.
2. Provide larger down payment.
If possible, try and put down more money. Often lenders decide rates on the home loan slab you fall into. Saving more and borrowing less could put you into a lower loan slab and thereby fetch your correspondingly lower rates.
3. Add women co-borrower.
This is the easiest way to get lower home loan interest rates. All you have to do is add a woman co-borrower you to application. Wondering how this will result in lower rates? Well, it’s simple – most lenders consider women as safer borrowers and therefore provide them a concession on normal housing loan interest rates.
This concession is usually a discount of 0.05% on the rates applicable for men. At first glance, this might seem like a miniscule reduction but you have to look at the big picture. Imagine a 0.05% saving on lakhs of rupees on your monthly EMI for up to 25 years? It takes drops you create an ocean and that what you’ll end up with by the time your tenure is over – an ocean of savings!
4. Refinance.
Some borrowers think they are stuck with poor rates since they have already borrowed a loan from a certain lender. They irk at the sight of promotional messages that show advertise home loans at lower rates. However, the good news is that, you can switch over to lenders who are providing better rates at any time. The process is called home loan balance transfer. It entails transferring your outstanding loan amount to a new lender to enjoy lower rates on offer.
5. Prepayments.
Though this is not a way to reduce your interest rates, it is a sure-shot way to lower the overall interest paid, and that’s the point right? It’s simple, when you prepay your loan, you reduce the outstanding balance. Since the interest amount of every EMI is calculated by applying the interest rate to the outstanding loan amount, a lower outstanding loan amount will automatically result in lowered interest amounts.
So there you have it, simple way to reduce the Apnaloan home loan interest rates. Hope this will help you save big, good luck and all the best!
Though this is not a way to reduce your interest rates, it is a sure-shot way to lower the overall interest paid, and that’s the point right? It’s simple, when you prepay your loan, you reduce the outstanding balance. Since the interest amount of every EMI is calculated by applying the interest rate to the outstanding loan amount, a lower outstanding loan amount will automatically result in lowered interest amounts.
So there you have it, simple way to reduce the Apnaloan home loan interest rates. Hope this will help you save big, good luck and all the best!
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