How should you decide the tenure for the repayment of your home loan?

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How should you decide the tenure for the
repayment of your home loan? Life in rented
apartments is a hectic and uncertain one. Even if
the place itself is nice, there is this constant
nagging feeling that keeps telling you that
youll have to leave it one day and move to
another place. Thats why its hard to get a
feeling of belongingness in a rented
accommodation. Having ones own home is
everyones dream. As soon as we step into
adulthood and get a job, we start planning for
our dream home. But it isnt so easy always.
Oftentimes, a lifetime of savings isnt enough to
buy a house especially given the fact that the
cost of real estate is increasing at a breakneck
speed with every passing day. The only way,
therefore, is to go for a loan. The trouble with
banks is that they disburse loans after
conducting plenty of background checks, studying
credit history and income tax dues etc. But
nowadays, an alternative solution has mushroomed
up in the form NBFCs (Non-Banking Financial
Companies). These companies offer low interest
home loans as compared to the traditional banks
and their disbursement procedure is quicker,
more efficient and user friendly as well. Among
the plethora of such options people often feel
baffled with choices. But when it comes to
deciding the terms and conditions of the loan,
something that people find very confusing is the
tenure of the home loan. People are always
worried whether they should consider a shorter
tenure or a longer tenure for the loan. Would 10
years be enough to pay off a home loan in Delhi
or should you go for 20 years? Naturally, the
longer your tenure of repayment the more amount
of money youll have to return to the bank in
terms of interest. Things however, are seldom as
simple as they seem. The problem with opting for
shorter tenure is that it isnt safe because the
monthly installments that youre paying to the
bank are quite high. A shorter tenure may work
now, given your present financial conditions, but
if you havent taken unprecedented factors into
account then you may end up getting yourself into
a boatload of trouble in the future. Imagine if
some unfortunate incident occurs in the future
and you end up losing a chunk of your income.
Then you would be faced with paying those high
installments while in a financial crunch. If you
dont, you may even end up losing your house
simply because you took a shorter tenure for a
home loan in Delhi. Therefore, its wise to go
for a longer tenure. Since youre required to pay
small installments every month, you arent under
pressure and you can manage even to pay them,
even in case of a financial crisis in the
possible future. The maximum tenure limit that
banks and NBFCs offer on loans is 30
years. Experts suggest that people should always
take their financial conditions in account before
deciding the tenure of a home loan. Even if you
have the necessary money to pay back the high
monthly installments easily, you should still go
for a longer tenure. The amount you save monthly
can become your investment. You can either
invest that money in stock market or go for safer
options, like a safe deposit. The inherent
response to quickly getting rid of the loan
doesnt translate into a wise financial decision
and its something you should refrain from.
Plan an easy way of repaying the loan, save the
excess
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money and invest it elsewhere. This way, youll
be able to generate wealth for yourself which can
even assist you in the repayment of loan in the
future.