A Home Financial Service is an amount of money that an individual borrows from a bank or a Non-Banking Financial Sector at a certain rate of interest to be paid with the EMI every month to purchase a residential property. Typically a home financial service will be given 5 or 30 years term, with regular monthly repayment that are designed to pay off the financial service over the contracted term.
The financial service is secured against your property so if you are unable to continue paying the EMI, the lender may ultimately require you to sell the property to settle the debt.
We provide Home financial services to Resident Indian (Salaried, Self-employed, Pensioner and Land Lords) and Non Resident Indian. Home financial service can be Term financial service or Max gain/Home saver.
A term financial service is a financial service from a bank for a specific amount that has a specified repayment schedule with a fixed or Floating Interest rates. In fixed-rate, financial service payment remains the same because the interest rate is constant and in variable-rate, financial service requires a different payment amount/ tenure when the interest rate changes.
A variable rate home financial service is exactly what it sounds like: a home financial service on which the interest rate can fluctuate, varying up and down at any time. Unlike a fixed-rate home financial service, a variable interest rate is changed regularly by your lender. Changes up or down in a variable interest rate are based on factors such as RBI Official Cash Rate , changes in market interest rates, or business decisions made by your financial institution. In terms of your home financial service repayments, a variable rate financial service means that the monthly financial service payments/the tenure will change to match any change in the interest rate applied. In terms of your home financial service repayments, a variable rate financial service means that the monthly financial service payments/the tenure will change to match any change in the interest rate applied.
The fixed rates on home financial services are reasonably higher at present. A fixed rate financial service simply means that the interest rate is “fixed” for a certain amount of time – commonly 1, 2, 5 years or full tenure.
Most home financial service borrowers face the dilemma of whether to use their monthly savings to prepay their financial service or set it aside for emergencies. In most cases, the extra money just sits in their savings accounts earning below par (and taxable) interest. A home saver financial service lets you have the cake and eat it too. You will be able to park this amount in the home financial service account for any number of days and pull it out anytime for your urgent needs or regular expenses when they become due. The money thus kept in the home financial service account reduces the total interest out go on your home financial service and helps you close your financial service faster. Disadvantage of home saver financial service is rate of interest is slightly higher than the term financial service rates. Interest savings are not tax deductible.
As per Income Tax Act 1961 rules, the current applicable exemption under section 24(b) is Rs. 2,00,000/- for the interest amount paid in the financial year and up to Rs. 1,50,000/- (under section 80 C) for the principal amount repaid in the same year.
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