Home Loan Charges: What charges does the bank levy while taking a home loan? know here...

Owning a home is everyone's dream. But owning a house is a big expense. This is the biggest purchase of most people's lives. In such situations, people take the help of home loans. A home loan is the longest-tenure loan.

Therefore, in this, you have to pay huge interest in the long term. Customers should keep many things in mind while taking a home loan. Charges associated with home loans are also one of these. Banks charge many different types of charges along with home loans. Let us know about them.

Application Fee-
This is taken for processing your home loan application. This fee is applicable whether you get the loan or not. This fee is not refundable. If you submit a loan application to a bank or NBFC and then change your mind, your application fee will be wasted. Therefore, before applying, make sure from which bank or NBFC you want to take a loan.

The application fee is taken in advance along with the loan application. However, some banks allow a part of this fee to be paid along with the loan application and the rest before getting the loan. This fee is either flat or as a percentage of the loan, determined by the financial institution or bank. If the bank wishes, it can also waive this fee. You can ask the bank for this.

Legal fees-
Banks or NBFCs usually hire external lawyers to investigate the legal status of the property. The fees that lawyers charge for this are collected by financial institutions from their customers. But, if this property has already been legally approved by the institute then this charge is not levied. You should find out from the institution whether the project in which you are going to invest has already been approved. This way you can save legal fees.

Mortgage Deed Fee-
This fee is charged at the time of selecting a home loan. It is usually expressed as a percentage of the home loan and forms a major part of the total fee amount to be paid for taking the loan. some institution

Commitment Fee-
Some banks or NBFCs charge a commitment fee if the loan is not taken within a specified time limit after the loan has been processed and approved. This is a fee that is charged on undisbursed loans. This fee is usually charged as a percentage of the difference between the amount sanctioned and disbursed.

Prepayment penalty-
Prepayment means that the loan holder pays the entire or the remaining amount before the end of the loan tenure. This causes a loss in interest rate to the bank, hence to compensate for this loss to some extent, banks impose penalties. These charges are different in different banks.

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