Mortgage loans: Boom for new buyers??

How can it be used to your advantage

•All of us aspire of owning a home, our very own space. We keep on planning for years to buy one. We save money, search affordable homes which can fit our pockets and budgets.

•This is not an easy task to find a suitable and good-to-buy house with all the necessary comforts and basic amenities under one roof.

•To make it possible you either have to go for home loans or mortgage loans. So if you are considering buying a home, a home mortgage might be the most viable option for you.

•It would be an important investment for you as it will affect you for a considerable portion of your life.

A mortgage is a loan in which property is used as collateral. This is generally used by those who want to purchase real property.

The loan is secured on borrower’s property. A legal mechanism is put in place so that in case the borrower defaults to pay off or violates the terms and conditions agreed upon, the lender can take the possession of the property and can sell it to recover the money.

In India, we have lenders like banks, building societies or credit union. Features like size and tenure of loan, interest rate may vary but generally when you get a mortgage; it takes 20-30 years to pay off the principal as well as the interest and after that you can be the proud owner of Flats in Noida.

In case of home mortgage, there are two kinds of interest rates: fixed and floating. Fixed rate remains the same throughout the years but if it is floating the interest rate may change depending on a number of factors.

There are a lot of advantages when one takes out a mortgage to buy a home. The first and most obvious is that you will not be paying a lump sum of money to own a home as you would not be required to pay the full amount up front.

This is much more convenient because generally houses are a very large purchase. The added advantages of mortgage loans are that they improve your credit score and reduce tax liability too so that you can easily invest in any good project such as Project in Noida.

In India we have different types of mortgages: -

1. Simple Mortgage -

In this, without delivering possession of the mortgaged property, a mortgagor binds himself personally to pay the mortgage money. If the transferor or mortgagor fails to repay the loan, the transferee or mortgagee has the right to sell the property and recover the amount of loan from the sale amount.

2. Conditional Selling mortgage -

In case of a mortgage by conditional sale, a mortgagor sells the mortgaged property on the condition that on default of payment of the mortgage money by a certain date the sale will become absolute or sure.

On the payment being made, the sale becomes void and on the payment being made the buyer will have to transfer back the property to the seller. Thus mortgagor becomes the owner of the property.

3. Usufructuary Mortgage -

In Usufructuary mortgage the mortgagor actually delivers the possession of the property to the mortgagee.

The mortgagee can rent out the property and receive the rent. The mortgagee receives the income from the property such Usufructuary Mortgage: in Usufructuary mortgage the mortgagor actually delivers the possession of the property to the mortgagee as through rent, profit, interest, etc until the repayment of the loan is done.

On repayment of loan the possession of the property is transferred back to the mortgagor.

4. English Mortgage -

In an English Mortgage, the mortgagor is bound to repay the borrowed money on a certain date. The mortgagor transfers the property to the mortgagee. But such transfer is subject to the condition that the mortgagee will transfer the property back on repayment before the agreed date.

5. Mortgage by deposit of title of deeds -

In such mortgage, the mortgagor delivers the title document of the property to the mortgagee with an intention to create a security thereon. Such mortgage is valid in only certain towns like Kolkata, Mumbai and any other town as the State Government may notify by publication in Official Gazette.

6. Anomalous mortgage -

Anomalous mortgage is actually a combination of different types of mortgages.

Thus to buy a home or to invest in a property like Property in Noida, you can use the mortgage loans to your advantage and can fulfill your dream of owning Flats in Noida as the property provides good opportunity for buyers especially the new or first time buyer to own a very well located house with all the luxuries.