Buyers Guide

Investing in real estate is an exciting proposition. However, homebuyers need to complete several steps in order to get the best of the deal. Home buying doesn't have to be overwhelming. Educate yourself on types of home, financing options, and overall costs to help you make a smart financial decision.

Loans

List of papers / documents applicable to all applicants:
  • Completed Home loan application
  • 3 passport size photographs (including those affixed in loan application)
  • Proof of identification: Electoral ID Card / Passport / Driving License / PAN card.
  • Proof of residence: Electoral ID Card / Passport / Electricity Bill / Telephone Bill.
  • Proof business address, in case of non- salaried borrowers.
  • Statement of bank account for the last six months.
  • Signature identification from present bankers.
  • Personal Assets and Liabilities Statements in Bank's standard format.
  • Brief write up of securities charged in respect of other loans availed from our Bank/other.
  • Banks/ Auto & Housing Loan Companies /other sources.
Advantages of Home Loan / Sense of accomplishment

Buying a home is one of the biggest financial investments you may make in your lifetime; and that's not just because of the sentimental value. The sum that most of us sink into our home does make it the largest component of our investment portfolio!

Capital Appreciation

For each one of us who has seen property prices boom over the last five years, the prospect of mouth-watering capital appreciation is the biggest argument for buying a home. Construction costs alone, which account for more than 70 per cent of the flat's cost, have risen at 15 per cent annually in the past decade. Rents too seem to keep up with inflation; making a home one of the few investments can shield you from inflation for the long term.

Low interest rate

Buying a home is a long-term decision of over a 10-year period; the interest rates may go through several up and down cycles. Therefore, you can be sure that you will benefit from falling rates at some point in the cycle. There could also be situations in which the interest rates fall, allowing you to prepay your loan and own your home. For instance, those who bought property in 1995, at an interest rate of 18 per cent, not only saw interest rates fall dramatically over the next decade, to bottom out at about 7.5 per cent, property prices too appreciated steeply. This works as a double boost to wealth. The best way to manage borrowing costs is by actively managing your home loans! That's not as difficult as it is sounds. Banks and home-loan lenders often give new borrowers much better rates than existing borrowers. During the uptick of the interest rate cycle, if your cost of borrowing increases by more than 2 percentage points, pay 0.5 per cent of the loan outstanding as processing fee (conversion charge) to your lender to avail the rates offered to the new borrowers. Tax Benefit: Interest paid As per Section 24(b) of the Income Tax Act, 1961 a deduction up to Rs. 1.5 lakh towards the total interest payable on the home loan towards purchase / construction of house property can be claimed while computing the income from house property. (The deduction stands reduced to Rs. 30,000 in case of loans taken prior to March 01, 1999). The interest payable for the pre-acquisition or pre-construction period would be deductible in five equal annual installments commencing from the year in which the house has been acquired or constructed.

Tax Benefit:

Principal Repayment As per the newly introduced Sections 80C read with section 80CCE of the Income Tax Act, 1961 the principal repayment up to Rs. 1 lakh on your home loan will be allowed as a deduction from the gross total income subject to fulfillment of prescribed conditions.

Disclaimer:

These are the broad guidelines meant for ready reference with respect to acquisition and transfer of immovable property in India and in each case prospective buyer or seller of property in India must consult his/her own legal/finance/tax advisor and obtain suitable advise for their specific transaction. Narang Realty assumes no responsibility or legal liability for transactions entered into by placing reliance on these guidelines. Further, Narang Realty assumes no responsibility for updating these Guidelines.

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DISCLAIMER:

"Narang Realty Private Limited ("Narang Realty"), a company owned and controlled by Gopal Narang and his family (the "Narangs"), is engaged in real estate development. The Narangs also hold 50% of the capital of Windsor Realty Private Limited ("WRPL") which is separately executing its own real estate projects. The business of WRPL is entirely independent and distinct from the business of Narang Realty."