Analyzing the skyrocketing property prices, most houses or flats would necessarily have to be purchased with the help of a housing loan by the common salaried people.  The overall Nett cost which includes the location, budget, and many other charges like stamp duty, registration charges etc. must be considered before going ahead with your plan of purchasing a home loan.

Introduction

Corporation Bank offers a suitable way to fulfill your dreams with Corporation Bank Home Loans.

In this article, we study all possible aspects related to Corporation Bank Home Loans.

A home loan is usually a high amount and is generally taken for a longer period upon which a rate of interest is levied. An important tool like Home Loan EMI calculator is therefore much needed to help you evaluate and plan your budget beforehand.

Interest Rate

Corporation Bank Home loan interest rate starts from 8.85% which is one of the best interest rates available in the market. The rates vary depending upon certain criteria like occupation, the quantum of income, nature of home loan, etc.

You definitely want to ensure that your lender provides auto-adjusted benefits on interest rates that extends into the future. That’s the reason why you need a credible lending institution with a dedicated and experienced workforce who will guide you through the entire process.

Features of Corporation Bank Home Loan

• Corporation Bank Home Loans are available for both salaried and self employed.
• Special rates for women customers.
• Home Loans granted to age group between 18 to 65 years.
• Security: Generally Mortgage of property you are planning to purchase, renovate or construct.
• Loan to Value Ratio is 90%.
• Maximum Tenure of loan is 30 years.
• Interest rates range from 8.85% to 9.10%.
• EMI of Rs. 794 per lakh

So, are you ready to buy a house?

If the answer is YES, you must be having a lot of questions in your mind like:

• Where will I arrange the money from?
• Am I eligible for the loan?
• How much down payment do I have to make?
• How much EMI will I need to pay every month?
• How can I compare the EMIs of different banks on my own?
• Where will I arrange the down payment amount and EMI amount from?

Let’s understand this with a simple example:

Let’s assume that your children are growing up and you want to renovate your ancestral house into a luxurious villa, so that children have more space to study, live and play. You go to corporation bank to enquire about the home loan. The cost of renovation is estimated to be 75 lakhs and you want to take a loan for 5 years. The bank is offering the loan at 8.75%.

Now, you have many options since there are a number of banks offering home loan for renovation. You need to calculate and check what the best fit is for you. Here, you can use the Home loan EMI calculator to check and compare.

The second obvious question is the source from where you will arrange the initial down payment?

The simplest option you have is to approach any relative or friend. But if you want to arrange it on your own then you must really think smart and be calculative in your decision. A great way to begin is ClearTax SAVE!

You have options like Savings account, RD (Recurring Deposit), SIP (Systematic Investment Plan) and many other ways to save enough for the initial down payment.

Let’s find out the best way to save your money, for down payment and for other expenses too:

Now, consider different methods for saving 15 lakhs down payment at Corporation Bank for the next 2 years:

Hence from the above table SIP is the most logical saving’s scheme; as an SIP, will enable you to invest regularly keeping in mind your goal by diversifying  your investment to get desired results. You will have a renovated home you dreamed for you children sooner than you expected.

Home Loan EMI Calculator, how does it work?

An EMI Calculator is a handy tool that calculates the monthly amount payable to the lender (Bank) every month. To calculate the EMI applicable on your loan amount, you need to use the sliders above to adjust the values of the Principal amount (P), Time duration (N), and Rate of interest (R).

Follow these steps to calculate your EMI Amount.

• Use the slider for selecting the loan amount
• Select the loan tenure in months using the slider
• Move the slider and select the interest rate
• Recalculate your EMI anytime by changing the input sliders
• EMI will be calculated instantly when you move the sliders

Calculate your EMI

Parameters to decide Interest Rates:

• Loan amount: Loan amount will decide the interest rate you are going to pay. The more the loan amount, the lesser the interest rate
• Your Salary:Salary amount will also be one of the deciding factors for the interest rate you are going to pay to the bank. Higher the salary lower would be the interest rate
• Type of loan opted for: The concessional rate of the home loan is offered for certain borrowers. Say, women borrowers enjoy a lower rate of interest compared to others, under different schemes. This way the interest rate could be higher or lower

It is generally advantageous to take a housing loan as it will allow you to get tax exemptions. However, you must consult your CA/ income tax advisor to know the benefits/disadvantages in your specific case.

Eligibility Criteria

To get Corporation Bank’s home loan, the eligibility standard must match. That becomes an important deciding factor for your loan amount. Following points fall under the eligibility criteria:

• Salaried, Self- Employed Professional or a Businessman
• Income
• Age
• Qualifications
• Number of dependents
• Co-Applicants Income
• Assets, Liabilities, Stability, and Continuity of Occupation of the borrower
• Savings History

Further, the loan eligibility will also be dependent on the value of property selected by you.

The deciding factor of the loan amount that would be granted to you will be the close assessment of the value of the property, the capacity to repay the loan amount and many others to determine the potential borrowers. So, an eligibility calculator can be used for the same.

Some of the key eligibility factors are listed below:

Penalties/Other Charges 

In addition to the mentioned interest rates, home loan also carries the processing fee, foreclosure charges, actual charges towards valuation fee, advocate’s fee for property search, title investigation report, stamp duty and other charges that are applicable.

Let’s discuss some charges in detail:

• Processing Fee – Corporation Bank charges 0.50% processing fees of the loan amount and a maximum of Rs. 50,000
• Technical and Legal Charges – Corporation Bank also charges technical and legal fees which differ with time according to the criteria.
• Prepayment Charges: If you decide to foreclose or transfer your housing loan to another bank, you need to submit an application for the same to Corporation Bank and follow RBI rules, which states nil charges on floating rate home loans.

Process of Applying

You can directly go to the bank or apply online by going through the bank website. You can avail the loan at low rates and low processing charge if you opt for the online mode. They will initiate the process by collecting your documents, will check your credit score, the value of your property for which you wish to take the loan and all other associated technical and legal terms. Once it is all done, you will be intimidated.

 Documents

Corporation Bank Tax Benefits

The income tax laws in India provide certain benefits for taxpayers who avail a home loan. Such taxpayers are eligible for a deduction of the interest paid on such house property to the extent of Rs 2 lakhs. In case of a self-occupied house in that particular Assessment Year (AY) they can claim the entire interest paid during the AY as a deduction without any limit, that is if they have given the property on rent.

Further, the principal component of such loan repayment can be claimed as a deduction from the total income under Section 80C, up to a maximum of Rs 1.5 lakhs.

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