With the rising costs, it can get difficult to pay your EMIs on time. Under these circumstances, lowering your home loan interest rate can be of immense help. There are several financial institutions that offer housing credit. So, here are some tips that you can use for minimising the rates.
11 Guaranteed Tips to Lower Home Loan Interest Rate
Below are 11 guaranteed tips that you can follow for a significant reduction in the housing loan interest rate:
1. Consider Prepayment of Your Credit
Prepayment of your credit, whenever you get extra money or bonuses from work, reduces the principal considerably. This leads to a diminishing of the overall interest that you will have to pay. Additionally, several financial institutions do not charge extra for prepaying your loan, and this can help you save significantly.
2. Go for a Home Loan Balance Transfer
A home loan balance transfer is one of the guaranteed ways of reducing your ICICI home loan interest rates. In this process, the outstanding credit amount is transferred to another financial institution that offers a lower interest rate. Thus you will have to pay reduced monthly instalments when compared to the present one.
3. Select a Shorter Repayment Tenure
Shorter credit repayment tenure ensures that you pay off your credit at the earliest. This also ensures that the overall interest that you will need to pay decreases considerably. However, you should not go for selecting an extremely low duration in case it gets difficult to pay EMIs on time.
4. Increase the Down Payment
While applying for an ICICI home loan
, if you increase the down payment for purchasing your house, the credit amount decreases considerably. This is beneficial as a lower amount subsequently leads to lower interest and EMIs. Hence, it won't pose a financial burden and you can easily repay it without any delay.
5. Revise Your EMIs Periodically
Several financial institutions allow you to revise your EMIs at periodical intervals. Hence, you can increase the interest rates for some time. This hastens the process of loan repayment. Thus, the overall interest that you were supposed to pay on a credit amount reduces considerably.
6. Maintain a Good CIBIL Score
A good CIBIL score reflects that you have repaid all your previous debts on time. This projects you as an efficient financial planner who has enough experience with timely payment of EMIs. Under such circumstances, you can negotiate with them to sanction your loan at lower interest rates.
7. Establish a Good Relationship
Maintaining a good relationship with the financial institution where you hold an account can be beneficial. This is so because they already have access to your bank statements. This gives you an added advantage and increases your chances of credit approval at lower interest rates when you negotiate with the financial institution.
8. Opt for a Joint Home Loan
On opting for a joint housing loan, the creditors will know that they can approach the other person for credit repayment in case you are unable to do so. However, you should keep in mind that the other person for a joint housing credit should have a good credit score and a stable job. This increases the chance of your credit approval at lower rates.
9. Show Proof of Additional Income
While negotiating with the lender about the interest rate, you can show them proof of additional income. This will make them believe that there is a constant inflow of extra cash. Thus, they will know you can pay your EMIs on time and hence, they will consider your request.
10. Ask Your Family to be a Guarantor
You can ask your family and friends to become a guarantor when applying for a loan. This is beneficial as your lenders will know that they can approach these people in case you delay or default on the credit repayment. However, you should keep in mind that your guarantor must also have a good CIBIL score.
11. Research Thoroughly for the Lowest Rates
Various creditors offer housing credits at different interest rates. So, it is highly essential to conduct a thorough research to find the one offering the lowest rates before proceeding with the application of home loan from ICICI and other financial institutions. Additionally, you should keep in mind that this list can include lenders who do not have a good market reputation. This can increase the chances of fraud. Hence, you should only go for the one that is reliable and has a good market reputation.
By knowing these tips for minimising the interest rate, you can proceed with the application for a housing loan.
Steps to Apply for a Home Loan
You can follow the steps below to apply for a housing loan:
Step 1: Navigate to a financial institution’s official page.
Step 2: Move to the home loan application webpage.
Step 3: Click on the “Apply Now” button.
Step 4: Input the essential details that are required.
Step 5: Enter your income details accurately.
Step 6: Select the appropriate loan amount and tenure.
Step 7: Verify your identity via an online process.
Once done, the creditors will verify your details, and if they are error-free you can get instant loan approval.
These tips can effectively reduce housing credit rates such that you can pay your EMIs on time. However, you should keep in mind that it is vital to compare the ICICI home loan interest rate
with the rates offered by various financial institutions to select the most affordable one.