Understanding Interest Rates and Tax Benefits in Home Loans: A Detailed Overview

Description

A home loan is a secured loan offered by banks and financial institutions to help individuals purchase or construct a home. Key pointers include:

Loan Tenure: Typically ranges from 10 to 30 years, allowing for manageable monthly payments.

Interest Rates: Can be fixed or floating, impacting the overall cost of the loan.

Eligibility Criteria: Based on income, credit score, employment status, and property value.

Tax Benefits: Borrowers can avail of deductions on interest payments and principal repayment under relevant tax laws.

Loan-to-Value Ratio (LTV): Indicates the loan amount as a percentage of the property value, affecting the down payment required.

These aspects are crucial for understanding and securing a home loan.