Home Loan: What are the fees or charges for home loan?


#NewDelhi: A roof over the head. Decorated house of peace. Home, sweet home. The dream of middle class Bengalis. But money is a barrier. It costs a lot of money to buy land. What an expensive book to build a house after that! This is where home loans come in handy. You don’t have to spend a lot of money in one go. Tax exemption is available on it. So nowadays almost everyone walks the path of debt to arrange a roof over their heads. But even when taking a loan, the bank or financial institution charges some fees or charges. Applicants can take these as home loan expenses. Now let’s take a look at the fees for taking a home loan.

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Processing fee:

The processing fee is the one-time charge after loan approval. The authenticity of the applicant’s application, the value of the property, the documents provided with the application are thoroughly verified by the concerned bank authorities. The bank takes a certain amount of money from the applicant to perform this task. Typically this processing fee can range from Rs.1000 to Rs.10,000. These charges vary from bank to bank. However, keep in mind that this money is taken one-time and is not refundable.

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Pre-payment charges:

The Reserve Bank of India has announced that there will be no pre-payment charges with floating rate home loans. This does not apply to customers who have taken home loans at fixed interest rates. However, if the customer plans to repay the loan before the loan expires, the bank or financial institution deducts the pre-payment charge.

Technical and legal assessment fees:

The bank hires a third party for the legal and technical assessment of the property while verifying the customer’s home loan application. For that you have to pay, technical fee and legal assessment fee.

  • Through technical or technical evaluation, the bank sees whether the bank should give this loan or not. At the same time, the sale value of the property that the customer has deposited for the loan is also verified.
  • The bank also verifies whether the pledged property is above all disputes, or whether there are any legal complications with its ownership.

GST on home loan:

The bank provides a number of services to the customer while giving home loan. Which comes under Goods and Services Tax or GST. As a result, when the customer takes a home loan, GST will be charged on processing fee, technical evaluation fee, legal fee.

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Documentation charge:

After signing all the documents, the bank charges Rs.500 to Rs.2000 from the applicant for Electronic Clearing Service or ECS. This is the documentation charge. In addition, the bank employs a third party to secure the loan repayment period after the secured property is registered. He also has to pay. This is also considered as a documentation charge.

Fee for renewal of loan:

Suppose the customer has chosen a loan repayment period of 15 years. Now if due to financial pressure or any other reason the term of this loan has to be extended, then the bank will charge a certain amount of money as fee. This fee will be applicable even if you want to reduce the term again.

Conversion Fee:

If the applicant wants to change the scheme to a loan scheme at a relatively low interest rate to reduce the interest rate at which the applicant has taken a loan, then the fee charged as conversion fee is the conversion fee.

In case of late payment of installments:

To repay the home loan, you have to pay the installment within a certain period of time every month. Now if it is late to pay the money, then the bank will take a penalty. This is called payment penalty.

Bounce check charge:

If the customer repays the loan by check, and if it bounces due to insufficient funds, then the penalty along with the installment has to be calculated.

Fee for expert opinion:

Many times the applicant can seek the advice of an expert or lawyer to understand the details of his loan. You have to pay a fee for it. However, this fee should be paid directly to the person concerned, not to the bank.

Photocopy fee:

If a photocopy of the home loan document is required for personal use, then the bank has to pay a fee for it.

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