Different Types of Home Loan

If you plan to buy your dream home, then many5. No-Mortgage-Loan: It is a loan where you need not
different schemes lead to it:hand over the house documents but give a lien on
Âyour other savings, insurance policies or shares.
1. Home-Loan: It is a term loan scheme with EquatedÂ
Monthly Installments (EMIs) under fixed or floating rate6. Top-up-Loan: Finally, after availing your home loan,
of interest.you can go for top-up-loans for home improvements
Âfurniture or fixtures.
2. Overdraft-Loan: It is a home loan in the form ofÂ
current account overdraft where you can park yourÂ
surplus funds and thus minimize the interest burden -Fixed and Floating Interest Loan: You can avail the loan
overdraft limit is reduced every month as per the EMIeither on fixed rate of interest or floating rate of
amount.interest. Fixed-interest loans are those for which the
Âinterest rate is fixed for the whole tenure. It is insulated
3. Flexi-Loan: It is a loan with one portion of fixedagainst market rate fluctuations. Usually, a small
interest rate and the other portion with floating interestpremium is loaded to the current interest to offset any
rate.loss to the bank/financial institution. Floating rate of
Âinterest is the rate that is linked to the prime lending
4. Realty-Loan: It is to buy a vacant land or plot whererate of the Central Bank (Federal Reserve) of the
you can build your dream home. It helps in beating pricecountry. If the Central Bank increases (decreases) the
rises on realty and build homes later.prime lending rate, then the bank/financial institution also
Âincreases (decreases) its interest rate.