It’s a loan given to you by the bank to buy a home.
The home or property you are purchasing is used as a form of security in case you cannot settle the loan. The bank keeps your property’s title deed until your loan is fully settled.
Before you apply for a home loan:
- Be aware of what you like and you don’t like, of the area and the price.
- Compare home loan rates and home loan providers (banks) to get the best deal.
- Keep your family’s needs in mind and make sure the home you buy works for your lifestyle.
The two key factors in your loan settlement are:
- How much you borrow.
- The settlement duration.
Generally you are required to pay back the home loan, as long as the interest, over a set period of time, most commonly between 20 to 25 years.
At the beginning, most of your loan repayments will pay off the interest. Over time, more of your repayments will go pay off the actual amount of the loan.
How do you qualify for a home loan?
One of the most important factors a home loan provider will use when they consider you for a home loan is your loan affordability. This is based on what you earn compared to what your monthly loan repayments could be.
The important factors to have a home loan:
- Age
- Income and job stability
- Additional income
- Credit history
- Other debt
- The size of the deposit you can put down for the bank
There are different types of House Loans depending on the purpose of:
Housing-Purchase Loan
Its purpose is to fulfill your ambition to buy a home under specific credit terms.
Housing-Building Loan
To help you build a home under specific credit terms.
Housing-Maintenance Loan
To help you maintain your home under specific credit terms.
Housing-Extension Loans
To expand your home under specific credit terms.
Housing-Construction Loans
To help you buy apartments or villas which are under construction.
What happens if you can’t pay my housing loan?
If you can’t settle the loan payments, the bank will sell your house at an auction. When the property is sold, the money will cover the loan.
