Here are some of the important features and benefits of home loan:
1) Flexibility to choose a tenure:, Most banks give you the flexibility to choose your home loan tenure, which generally ranges from 15 - 30 years. The tenure you choose directly impacts the EMI you pay every month.

2) Comparatively cheaper than personal loans: The rate of interest on home loans is generally lower in comparison to the personal loans. This is because home loans are generally secured loans whereas personal loans are unsecured loans.

3) Tax benefits: You get tax benefits on both the interest amount and principal amount you pay. The interest paid can be claimed for a deduction of upto Rs 2 lakhs every year, whereas the principal amount paid can be claimed for a deduction of upto Rs 1.5 lakhs per year.

4) Home loan balance transfer: This facility allows you to transfer your outstanding loan amount from one lender to another for the purpose of taking advantage of lower interest rates.

a) Home loan for purchase:
Most commonly available, this type of loan is for purchasing a residential property, whether it is a resale home, a ready-to-move-in home or an under construction home.

b) Home loan for construction:
This loan is available only for construction of a house and is offered to those who own a piece of land.

c) Home loan for renovation:
This can be availed for making renovations or improvements to an existing home.

d) Bridge home loan:
This loan is availed by those who are looking to upgrade their homes to bigger or better ones. Such a loan helps meet shortage of funds that arises due to time lag between sale of existing home and purchase of new one.

e) Step up home loan:
Designed primarily for young salaried professionals, this home loan helps you avail a bigger amount as compared to your eligibility under regular home loans. Also, under these loans, the EMIs are kept lower during initial years.

f) Balance transfer home loan:
This facility allows you to transfer your existing home loan from one lender to another for the purpose of taking advantage of better interest rates.

Here are some key factors that you must consider before applying:
• Make sure your credit score is good. Higher the score, the better.
• Check if you can afford to pay monthly EMIs from your current income.
• Research all the loan options available before finalizing an offer.
• Choose a repayment tenure that's convenient for you. Shorter tenure means higher EMI, and vice versa.
• Know the prepayment terms of the loan and the charges applicable.
• Ask the lender for all the additional charges that may apply to the loan.
• Lastly, read all the documents carefully before signing.

Apart from the interest rates, there are many other types of charges associated with home loans. Take a look at some of the most common home loan fees and charges:
Processing fee: A one-time charge, non-refundable fee charged by the banks for processing your loan application. Although most lenders charge this fee, there are some banks that offer zero processing fee schemes as well. Generally, this fee ranges from 0.5%-1.0% of the loan amount.

Prepayment charges: This is the charge that you may have to pay for early repayment of your loan. As per RBI norms, there is no prepayment penalty on floating rate home loans. However, in case of fixed rate loans, lenders can charge a prepayment penalty of up to 2%.

Loan conversion charges: This fee is charged when you switch your home loan from floating to fixed rate or vice-versa. Loan conversion fee varies from bank to bank. However, most banks charge a conversion fee of 2% of the outstanding amount.

Legal and technical charges: Also known as Administrative charges, these charges are levied by the banks for getting your property and other documents verified. These charges may range from Rs 5,000 to Rs 10,000.

MODT Charges: Memorandum of Deposit of Title Deed (MODT) charge is levied for an undertaking that you are submitting your property documents with the bank at your free will. It generally ranges from 0.1% to 0.5% of the loan amount. Banks usually incur this charge initially, but later on they recover the same from the borrower.

Lenders use your Credit score as an indicator of how likely you are to repay the loan. The higher the score, the lower the interest rate you pay on your loan.
Score below 600: A score below 600 generally indicates high risk. With such a score, it may be a little tough to secure a loan. If your score is below 600, it's best if you try to improve the score before applying for a home loan.

Score between 600 and 749: Although it's not considered a very good score but it gives you at least a chance to get the loan approved. Some lenders might approve your loan with this score after considering your income, your employment/business, etc.

Score of 750 and above: If your score is 750 or above, you are most likely to get your loan approved. Not only that, you are also most likely to secure the loan at an attractive rate of interest.

If you are applying for a home loan with a woman as a co-applicant, you can enjoy a concessional rate of interest on your loan. The interest rate in such cases are usually around 0.05% (5 basis points) lower than the standard rates.
To avail this benefit, make sure the woman co-applicant must be either the sole owner or a joint owner of the property.

Here are some of the key factors that can help you improve your Credit score:
1) Pay your dues on time: , You must pay all your dues on time, including your credit card bills as well as other loans you may have. Timely payments indicate your reliability when it comes to loan repayments.

2) Keep checking your credit report: At times, your score may get hit due to certain errors in your credit report. Keep an eye on the report and if there are any discrepancies, report to the credit bureau for correction.

3) Optimize the loan tenure: YIf you are taking a loan, try to choose a longer tenure. This will keep your EMIs low and ensure that you never default on repayments.

4) Maintain the right mix of loans: To have a right combination of secured and unsecured loans can also help improve your Credit score. Make sure you repay all the loans on time. This will help create a good credit history.

5) Avoid too many loans: You should not take on too many loans at the same time. Having too many loans may indicate high repayment risk. Additionally, if you fail to repay any of the loans, your credit score may get seriously impacted.

It's an option that allows a borrower to pay only the interest amount on the disbursed home loan until the construction of the property is completed. This means if a borrower opts for pre-EMI, he/she will not have to pay the principal amount until the property is ready for possession. Thus, once the property is ready, the pre-EMI payments will end and the EMI payments will start. For example: A person takes a home loan with a tenure of 30 years. The construction of the property completes in 5 years. If this person opts for pre-EMI, he will have to pay the interest every month for 5 years. After 5 years, this person will start paying regular EMIs (interest + principal) for 30 years.

Who should opt for pre-EMI?,
This option works best for those who are living in a rental home and, therefore, cannot afford to pay the full EMI plus the rent every month. With pre-EMI option, such borrowers will be required to pay "interest only" until the property is ready for possession.

Moratorium period is that period during which you don't have to pay any EMIs on your loan. This facility is provided by lenders to help you manage your finances better and ensure that you don't have too much of a financial burden immediately after taking a loan. For example: If a person gets a moratorium period of 3 months on their home loan, then he/she will not have to pay any EMI for the first three months after getting the loan. The EMIs on the loan will start after 3 months.