HOME LOAN CHARGES ONE SHOULD KNOW. PLANNING TO BUY NEW HOME???? When you plan to buy a house by availing a home loan, the biggest cost component you are.

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HOME LOAN CHARGES ONE SHOULD KNOW

PLANNING TO BUY NEW HOME???? When you plan to buy a house by availing a home loan, the biggest cost component you are worried about is the interest amount. But apart from interest charges, you will have to pay for a plethora of other charges as well.home loan

Types of fees banks levy on home loan borrowers

TYPE 1: APPLICATION FEES This fee is charged by the bank for processing your application. It will be charged upfront irrespective of the fact that whether your loan application is accepted or rejected. It is non-refundable and can go up to 1% of the loan amount. Make sure that you do your research before applying for home loan as this fee is non- refundable.

TYPE 2: PROCESSING FEES This fee is charged by banks to verify your documents as the process involves people effort and legal charges. The processing fee varies from bank to bank and usually ranges between 0.5% and 1%.

TYPE 3: CONVERSION FEES It is the fee that you need to pay to reduce the interest rate. Suppose, you availed home loan at 11% in 2012 and now the bank has reduced the interest rate to 10.25%. So, in order for you to benefit from the drop in interest rates, you will have to pay a conversion fees that will range between 0.5% and 1.0% of the loan amount.

There are many secondary charges like Legal fees, Memorandum of deposit of title deed, Document retrieval charges, Prepayment penalties, Switching charges

Always clear your doubts and read carefully about the charges and fees required to avail Home loans. Read about additional charges or for best advices on your home loan, consult PaisaBazaar.com.PaisaBazaar.com