Should i go for home loan
I have saved 15L in the past 2.5 years, and i am planning to buy a home worth 50 L in tier 3 city. I want to take a Loan of the remaining amount and i am the only earner in my family. Considering the current situation of Layoffs/Downsizing etc etc in IT,is it okay to take a loan and solely depend on my income for loan repayment. Im 25 rn and we don't have our own house. So need one. What are the other ways in which i can buy a home.
simplyset
Stealth
5 months ago
Personal Opinion:
- Your financial discipline is impressive, saving ₹15 Lakhs in just 2.5 years. Currently, you save ₹50K per month, creating a surplus beyond the 20% down payment needed for a loan.
Here's a refined plan: Set aside ₹3 Lakhs for future security, then take a ₹37 Lakhs loan over 10 years at 9% interest, resulting in a manageable ₹47K monthly EMI. This tenure aligns with your current savings rate.
Allocate the reserved ₹3 Lakhs into a Debt fund, providing a 6-month EMI cushion. Additionally, your severance pay offers another 3 months' buffer. This leaves you with a comfortable 9 months to find a new job if needed.
Fulfilling your family's dream will inspire you to overcome any challenges.
Note: While furnishing expenses aren't factored in, your yearly hike can cover them gradually, now that you have a roof over your head.
Stay motivated, and all the best! 🟢
Thanks for the reply. I didn't know this perspective. I have a question. Why not 20yrs for loan repayment. I can save 50k per month, but being on the safer side can i not make it 20 years and save this 25k and put back bulk repayment after a few years. Wouldn't this be safe game? Or what should i consider when i am setting years for loan repayment.
simplyset
Stealth
5 months ago
I personally don’t want to live in EMI life. Try to close as soon as possible. Even go for an early principal payment to save a ton of money on Home Loan Interest.
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One imp thing, check for OD loan account with your bank and if they have lock-in period on this acct. I would suggest to choose a bank with no lock-in period on OD acct so that you can keep your earnings there with 0 interest on that amount.
For eg.: Loan principal amt: 50 lacs, amt kept in OD acct: 10 lacs (emergency fund), so interest will be applicable on 40 lacs.
