By Atul Monga
Diwali isn’t just about lights, it’s also a time for new beginnings and thoughtful decisions, and for many, it is also a time to take a step toward owning a home. There’s something truly special about celebrating the festival in a space you can call your own.
With the festive season around the corner, buying a property is on top of the minds of many young Indians. Banks and builders are rolling out festive offers, and recent relaxation in GST has lowered construction costs, encouraging developers to offer competitive pricing. With improved affordability across metros and smaller cities, this Diwali could be a practical time to explore home ownership.
Here are 5 key points to keep in mind while looking for a home loan, especially during the festive season.
Credit score is key
Your credit score plays an important role in determining your home loan eligibility and interest rate. Lenders typically offer lower interest rates to those with stronger credit profiles. Hence, it is important to check your credit report ahead of time, correct any errors and clear outstanding dues. Even a small improvement in your credit score can go a long way when it comes to saving money in the long run.
Larger downpayment now, relaxation later
While lenders may be willing to finance up to 90 per cent of your property’s value, contributing a bigger chunk upfront can really work in your favor. Let’s say you’re eyeing a home worth Rs 60 lakhs. If you increase your down payment to 30 per cent, you could potentially save around Rs 8 lakhs over time, especially with interest rates hovering around 8.4 per cent.
A larger down payment can reduce your loan burden, cut interest costs and improve your negotiating power with lenders; and festive season offers can make the deal even sweeter.
Make sure you Scan Through Debt-To-Income Ratio
Lenders generally prefer that your total EMIs don’t exceed more than 40–45 per cent of your monthly income. But with rising credit card usage and UPI transactions, it’s easy to lose track and go over that limit without even realizing it. That’s why it’s important to review your debt-to-income ratio before applying for a home loan. Clearing off smaller debts or credit card dues can improve your loan eligibility and help you stay financially balanced once your home loan EMIs kick in.
Factor the new GST 2.0 reforms
GST 2.0 reforms have made home more affordable by reducing the construction costs for developers. This means better pricing, especially for the affordable housing segment. For homebuyers, this can reduce the loan burden and when combined with festive offers, it’s a golden opportunity, especially for first-time buyers.
Look Beyond the Festive Hype
While festival deals can be tempting with offers like zero processing fees or lower interest rates, these offers usually favour borrowers with solid credit scores. It’s easy to get caught up in the excitement, but don’t ignore the fine print.
Watch out for hidden costs like mandatory insurance, prepayment or foreclosure charges, and step-up EMI structures that might impact your finances later on. At the end of the day, it’s not just about the offer, it’s about knowing exactly what you’re signing up for. Always read the terms carefully and ask questions if something isn’t clear.
This festive season in particular brings in a unique blend of tradition, supportive government policies, and favorable market conditions making it an ideal time to consider investing in a home. But good timing is just one part of the equation. With thoughtful financial planning, you can turn this opportunity into something truly special: a home to call your own.
(The author is CEO & Co-Founder, BASIC Home Loan)
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