When it comes to buying a new house, the most essential step is raising adequate funds. Your budget not only determines the house’s location and size, but also the builder and the quality of the exteriors and interiors. For instance, Rs.1 lakh will be able to fetch you approximately 5.3 sq. ft. in Mumbai, 16.1 sq. ft. in Bangalore and 27.5 sq. ft. in Hyderabad. Hence, planning your finances in advance is key to making your dreams and aspirations a reality.
So take a look at 4 ways in which you can raise funds to buy your new house:
Save cash and sell assets to make a big down payment
Lenders will generally give you 80% of the amount you need to buy your house as a home loan. This means that you need to source the remaining 20%. For example, if your property is worth Rs.1 crore, you will need to pay around Rs.20 lakh as down payment. It’s still a large amount, so planning for it is a must. Making lifestyle choices like curtailing large spends on consumer goods or reducing frivolous expenses on fine dining and luxurious vacations can help you save the amount you need. Another option is to sell assets like an unused property or an extra vehicle to get the required funds.
Avail a large amount with a home loan and save tax too
You can make your purchase viable by taking a high-value home loan. Leading NBFCs gives you quick access to Rs.3.5 crore at competitive interest rates, for a period of up to 20 years. Availing a home loan gives you the benefit of saving money basis the Income Tax Act, which is an added benefit. For instance, Section 80C allows you to claim a deduction of up to Rs.1.5 lakh basis the principal repayments on your home loan. Likewise, Section 24B gives you a chance to claim deduction of up to Rs.2 lakh basis interest repayment on your home loan. Further, first-time homeowners can claim an additional deduction of Rs.50,000 under Section 80EE. Even though taking a home loan is a lengthy commitment, it gives you perks along the way.
Get funds via a loan against securities
What is loan against securities? It is a high-value loan that a lender sanctions in exchange for your investments in securities, which it holds as collateral. Here you can pledge a range of assets like shares, bonds and mutual funds and get a large amount. Once pledged, your portfolio will still earn interest from the market, so while you repay the loan your portfolio will grow too. However, this loan is a short-term loan so be sure to use it only if you are likely to have the money for repayment in the coming months.
To get the best features consider taking a Loan Against Securities as it gives you a handsome loan of up to Rs.10 crore at cost-effective interest rates. With zero prepayment and foreclosure fees, easy online access and a quick disbursal within 72 hours, this is an outstanding solution. Rather than liquidating your shares and mutual funds, take a loan against securities to raise funds for your new home purchase, and repay the amount over a period of 12 months.
Make use of assistance via PMAY
Becoming a first-time homeowner has never been easier thanks to the Pradhan Mantri Awas Yojana scheme. It allows you to claim subsidy on the interest you pay on your home loan. Under the Credit Linked Subsidy Scheme, you can claim a maximum interest subsidy of Rs.2,67,280. This scheme is available to households drawing an annual income of up to Rs.18 lakh. So, if you or your family does not own a property anywhere in India and you qualify as per the terms set by PMAY, you can enjoy the perks of the scheme and become a homeowner without any delay.
When looking for a lender that gives you high-value loans, affordable interest rates and all the benefits of PMAY. With financial solutions ranging from home loans and loans against securities to loans against property and home insurance, it is the one-stop shop for all your needs.
Additional Read: Need Money Urgently? Here Are 4 Short Term Loan Options For You