Things You Must Know Before Applying For Home Loan!
The most common dream of every Pakistani is to build its own house. However it is considered a distant dream for a salaried person. That is the main reason behind bank loans applications particularly in Pakistan. In the past people used to go for House Building Finance Corporation for that purpose but now the trend has changed. A great number of people prefer to use commercial banks for home loan purpose. Main reason for it is the low-interest rate and quick services provided by the banks in delivering the loan to their customers.
However before filing your application you must have proper knowledge of the whole procedure and paperwork concerned as it is more important than choosing the right bank for home loan. Choosing the right home loan can be just as important. Here are some tips to help you in this regard:
Do not ignore your credit score
A handsome credit score will help you attract the best home loan deal so never ignore it. In some cases it will be suitable to get a draft of your credit report before you even think to buy a home or apply for its loan. It will also provide you a chance to improve your credit score.
Get the paperwork ready
Before applying for a bank loan, you will need to provide the bank with a number of financial and other documents. If you have already assembled and lined up these important documents think half task done. This practice will also accelerate the processing of your loan application.
Try to use a loan calculator
Most of the commercial banks provide a kind of loan calculator on their websites. In fact it is a great tool if you want to have an idea about how much home loan you can afford and in how many installments it will suit you to return it.
Compare offers for best decision
All the banks do not devise their bank loan schemes on the same rules and with the same results, though they seem to be similar but it is not so. Even if they have the same interest rates, there could be differences in the points and fees that make one offer more expensive than the other one. To save your time and money you must study and compare each bank scheme minutely before you choose one.
Never ignore the interest rate
Interest rate is the most important factors which determines the future cost of your loan. Sometimes the interest rate may seem to be less but there would also be some hidden charges which would make the loan costly for you in the future. So you also have to look for all these charges which may be hidden from your sight at the initial stage of your application.
Respond quickly to your Bank
it is very important to respond quickly to your lender for any requests about additional information. A slow response will automatically retard the ongoing paperwork and will in turn slow down the bank loan procedure.
Issues and Challenges related to bank loans
Along with the above tips you must keep in mind the following issues and challenges regarding bank loan trends in Pakistan.
- The complicated process and paperwork which makes the process cumbersome.
- Tough conditions applied by various banks in terms of securities.
- High taxation rate and duties.
- Lack of interest/ awareness among the public.
- Bank’s margins are often higher than expectations.
- Turbulent property prices in major cities often collide with interest rates.
Commercial banks are offering home loan
Almost all the commercial banks are offering home loan facilities with varying interest rates amongst which the following names are thought to be more reliable.
- Dubai Islamic Bank
- Meezan Bank
- Bank Alfalah
- Summit Bank
- Faysal Bank
- Bank Islami
- Bank Al Habib
All these banks have nearly same plans but the Dubai Islamic Bank and the Islami bank have some exceptional offers for its customers. Specially Dubai Islamic home investment is one of the best options if you want to get a home loan according to the shariah compliant manner. This offer is not only for the newly built home but you can also get benefit from it if you want to furnish your earlier home.
Do not forget to visit our blog at RightDeed.com for more such useful informations related to your dream home.
May 8, 2018 AT 11:47 AM
very informative article. according to me meezan bank's easy home product has best features and i found it quite easy to understand as compare to other islamic banks.
June 8, 2018 AT 11:23 AM
please share the information about the loan details of Dubai Islamic bank?
June 21, 2018 AT 05:23 AM
i was about to comment the same thing