5 Pertinent Questions To Ask Before Applying For A Home Loan In 2022


Applying For A Home Loan

Applying for a home loan is almost mandatory to construct or purchase a house. This is because the expense of buying or constructing a house is well beyond the financial capability of most Indian citizens. 

Thankfully, Indian lenders offer attractive interest rates and easy terms and conditions to ensure everyone can apply for a home loan. But, since a home loan is an extended-term liability, it is wise to make a plan and stick to it.

Before applying for a loan, you must know that non-repayment of home loan dues (principal and/or interest) can make you a defaulter. It can also have a devastating effect on your credit score.

Moreover, you may receive a notice from the lender, and in the worst case, the lender may take possession of the property and sell it to recover their dues.

So, before applying for a home loan, it is important to align your financial goals with the upcoming liability. You must also know the loan terms and conditions, eligibility, home loan type, interest rate, etc. 

The following are the five pertinent questions before applying for a home loan in 2022:

Can You Make The Downpayment?

Yes, you have to make a downpayment to avail of a home loan in India. 

As per the RBI (Reserve Bank of India) guidelines, every borrower needs to make a downpayment of 10% or more of the loan amount while availing a home loan in India. So, if your loan amount is INR 50 lakh, the minimum downpayment will be INR 5 lakh. 

You need to analyse whether you can pay the downpayment amount instantly or not. Also, don’t forget to factor in stamp duty, registration fee, processing fee, etc., as these charges increase the net cost.

If you are not ready to shell out the downpayment amount, you may reduce the loan amount or find a lender offering lower housing loan interest rates.

Have You Thought of Insuring Your Loan?

Nowadays, lenders ask borrowers to insure their loans. This eliminates the risk of NPA (Non-Performing Assets). Therefore, if you opt for home loan insurance, the lender feels assured about the repayment and offers the best rates. 

However, before signing on the home loan insurance application form, you must understand it. Home loan insurance ensures that timely repayments are carried out even when the borrower has passed away. This saves the borrower’s dependents from financial hardships. 

However, a traditional home insurance plan only covers the loan expenses, including principal and interest, and does not pay anything to the nominee. So, you must also apply for life insurance and/or term insurance to secure your dependents’ lives.

Can You Tackle a Financial Emergency After Paying Loan EMI and Downpayment?

Life is unpredictable, and you need money to tackle an emergency. It is wise to evaluate whether you have the funds necessary to deal with an emergency or not. You may calculate the approximate money required to handle emergencies and decide the loan amount appropriately. 

An intelligent borrower never empties their bank accounts to fulfil their housing dreams. Have enough money in your savings account to fund emergency expenses without applying for more loans.

Are You Ready To Negotiate?

Borrowers are well within their rights to negotiate with lenders. You can ask your lender to reduce the housing loan interest rate, processing fee, and loan amount before applying for a home loan.

However, before negotiating with the lender, ensure that your CIBIL score is above the benchmark. Lenders consider borrowers with a CIBIL score of 750 as the benchmark.

If your score is above 750, you can negotiate better.

Do You Know the EMI?

Knowing the EMI is vital for making informed decisions. Many lenders provide free home loan EMI calculators to help borrowers discover their monthly liabilities before applying for a home loan.

You can enter the loan amount, interest rate, and tenure to estimate the EMI amount.


Applying for a home loan and getting it approved is relatively easy when prepared. The questions mentioned in the article can help you stay better prepared to secure quick loan approval and attractive home loan interest rates.

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