Buying a home is a big step. It can be a source of anxiety, frustration and an enormous sense of accomplishment. With the zooming property rates, it is difficult to buy a home through your savings entirely. Almost all of us have to avail a home loan.

Usually, a home loan is one among the most important liabilities. Considering the large amount and therefore the long tenure involved, However, your home loan also offers you some benefits. In the below write-up the best builders in Chennai (GP Homes) highlight the advantages of taking a home loan.

Sense of accomplishment

Buying a house is one among the most important financial investments you’ll make in your lifetime, and that is not simply because of the sentimental value. The sum that the majority of people sink into our home does make it the most important component of our investment portfolio!

Capital Appreciation

For each one among us who has seen property prices boom over the last five years, the prospect of mouth-watering capital appreciation is the biggest argument for purchasing a home. Construction costs alone, which account for quite 70 per cent of the flat’s cost, have risen at 15 per cent annually within the past decade. Rents too seem to stay up with inflation; making a home one among the few investments can shield you from inflation for the future.

Low-interest rate

Buying a house is a long-term decision of over 10 years; the interest rates may undergo several up and down cycles. Therefore, you can be sure that you will enjoy falling rates at some point within the cycle.

There could even be situations during which the interest rates fall, allowing you to prepay your loan and own your home. For instance, those that bought the property in 1995, at a rate of interest of 18 per cent, not only saw interest rates fall dramatically over subsequent decades, to bottom out at about 7.5 per cent, property prices too appreciated steeply. This works as a double boost to wealth.

The best way to manage borrowing costs is by actively managing your home loans! That’s not as difficult as it sounds. Banks and home-loan lenders often give new borrowers far better rates than existing borrowers. During the uptick of the rate of interest cycle, if your cost of borrowing increases by quite 2 percentage points, pay 0.5 per cent of the loan outstanding as processing fee (conversion charge) to your lender to avail the rates offered to the new borrowers.

Tax Benefit: Interest paid

As per Section 24(b) of the tax Act, 1961 a deduction up to Rs. 1.5 lakh towards the entire interest payable on the house loan towards purchase/construction of house property are often claimed while computing the income from house property. (The deduction stands reduced to Rs. 30,000 just in case of loans taken before March 01, 1999).

The interest payable for the pre-acquisition or pre-construction period would be deductible in five equal annual instalments commencing from the year during which the house has been acquired or constructed.

Tax Benefit: Principal Repayment

As per the newly introduced Sections 80C read with section 80CCE of the tax act, 1961 the principal repayment up to Rs. 1 lakh on your home loan will be allowed as a deduction from the gross total income subject to fulfilment of prescribed conditions.

No Lock-in of Funds

It’s no secret that a home in India is expensive. Even if you do have the cash to inherit a home without a loan, it’s not advisable to try and do that. Emergencies can appear any time, and it hurts if an enormous sum of your cash is locked up inland. While a house is an excellent investment, it’s difficult to liquidate it on short notice. So better go for a home loan.

Improves Credit Score

Paying off your EMIs (equated monthly instalments) on a home loan is a great way to improve your credit score and credit-worthiness. If you have a good record on your home loan, it becomes easy for you to finance other purchases like car loans or your child’s student loan.

Lowest Cost Debt to Create an Asset

The rate of interest on a home loan is cheaper than any other loan in India. It’s easy to urge a home loan because it’s secured against an asset. A home loan is the most cost-effective way of funding a long-term asset.

Now that you know the benefits of home loan go ahead and buy your dream home with us GP Homes – the best builders in Chennai for we offer quality homes like no other best builder in Chennai can. Also, make sure to have a look at our Ayanambakkam flats and also flats at Ayapakkam