What are the other costs that usually accompany a home loan?
Home loans are usually accompanied by the following extra costs: a) Processing Charge: It is a fee paid to the lender when you apply for a loan. It could either be a fixed amount not linked to the loan or could also be a percentage of the loan amount. b) Pre-payment Penalty: When a loan is paid back before the end of the agreed duration, a penalty is charged by some banks/financial institutions, which could be up to 5% of the amount pre-paid. c) Commitment Fees: Some institutions levy a commitment fee in case the loan is not availed within a stipulated period of time after it is processed and sanctioned. d) Miscellaneous Costs: Some lenders may levy a documentation or consultant charge. e) Registration charges of the mortgage deed.
A- Home loans usually attract following extra costs: a) Processing Charge: It’s a fee payable to the lender on applying for a loan. It is either a fixed amount or may be a percentage of the loan amount applied. b) Pre-payment Penalties: When a loan is paid back before the end of the agreed duration, a pre-payment charge is demanded by some banks/companies, which is usually between 1% and 2% of the amount being pre-paid. c) Commitment Fees: Some institutions levy a commitment fee in case the loan is not availed of within a stipulated period of time after it is processed and sanctioned. d) Miscellaneous Costs: It is quite possible that some lenders may levy documentation or consultant charges. e) Registration of mortgage deed.
Home loans are usually accompanied by the following extra costs: • Processing Charge: Its a fee payable to the lender on applying for a loan. It is either a fixed amount not linked to the loan or may also be a percentage of the loan amount.The loan amount required by you cannot be less than the processing fee. • Pre-payment Penalties: When a loan is paid back before the end of the agreed duration, a penalty is charged by some banks/companies, which is usually between 1% and 2% of the amount being pre-paid. • Commitment Fees: Some institutions levy a commitment fee in case the loan is not availed of within a stipulated period of time after it is processed and sanctioned. • Miscellaneous Costs: It is quite possible that some lenders may levy a documentation or consultant charges. • Registration of mortgage deed.
