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Tips to buy a Home with Single Income

Vraj Tiara

In the days when many young adults are delaying marriage, the number of millennials buying a home on single income is growing. The recent increase in women owned homes has also been seen as a new trend among home buyers. Keeping with the trends, Vraj Tiara also offers a 3% rebate on stamp duty for women owners.

There may be various reasons for a single home ownership- The buyer may be the only breadwinner of the family, wanting more autonomy on the property, wanting a single income property, or simply that the buyer is confident about the purchase he/ she is making. There may be more than one reasons but buying a home seems a daunting process to most. With some financial planning, one can easily overcome these hurdles, even if it means that you are a first time home buyer.

With interest in home loans on an all-time low, the markets are expecting the rise among first time home buyers. The single mortgage applicants have more hurdles than the ones with double income, because they rely on one salary and one credit profile to secure loans, and the underwriting process can be tricky.

Here are some tips to ensure you get a lender with an affirmative response.

Improve Your Credit Profile

When applying for home loan, review your credit profile, especially for a solo buyer. Many banks and financial institutions make available your credit score for free, if you are an existing customer. Do not make costly purchases before applying for a loan. This will improve your credit score.

Choose an EMI plan

Choose a lender that offers a low rate of interest based on your credit profile. An example of this is a 100 basis points or 1 percent cut in home loan interest rate impacts your EMI and total interest cost. Even a 100-basis points reduction can help you to save a few Lakhs in interest cost, depending on the remaining tenure of the loan.

To keep interest burden low, another option is to keep pre-paying the principal on regular intervals, ideally 6 months or annual basis. This will reduce the principal amount much early during the loan tenure to avoid interest rate to inflate during the home loan repayment towards the end of the tenure.

Get an insurance plan to Protect Your Home

Being a single income investment, it is necessary to ensure you are protected during those unfortunate events of unemployment, accident or financial loss. There are premium insurance plans that can offer protection from such unexpected events that can lead to non-payments. The mortgage protection life insurance is one such plan that can take care of your mortgage payments. It only intends to help in repayment of home loans.

Get your Down Payment

Although the government allows 80% home loans and 20% down payment, if you are struggling to come up with a down payment, as an alternative to the conventional mortgage, consider a government-insured loan.

While low down payments also has a risk factor attached to it, here are some ways to ensure you can attain the same.
– Taking loan from your employer will be an easier process considering they have assurance of your salary
– Mortgaging gold over home loan can be a viable option, since many private institutes are willing to pay money over gold.
– An extension to the gold loan, some institutions offer 11% interest against gold for a duration of 12 to 60 months.
With payment schemes offered by real estate developers, such as residences of Vraj Tiara ,at Worli, offering a 30/70 payment scheme, most buyers can see this as an opportunity to realise their dream of luxurious sea facing flats of 3 & 5 BHK bed apartments.

With a planned way to buy your dream home, it doesn’t matter if you have a single or a double income, it isn’t a deciding factor to own a home. There is a home for every income bracket and one should educate oneself of the various schemes and loans offered to fulfil your dreams.

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