Taking Home Loans in the 40s and 50s - Home Loan Stories

16 AUGUST, 2019

People work harder throughout their lives to be able to buy a house. In the last few years, the number of home buyers and the prices of properties, both have significantly increased. As a result, many people are preferring the help of home loans instead of spending their entire savings to buy a property. To encourage this regime, the financial institutions are providing the buyers with home loans with attractive interest rates.

There still goes a common misconception that it is difficult to obtain a home loan during your 40s and 50s. People in their late 40s and 50s think that they will not get as many benefits as people in their 30s get, while taking a home loan. However, this is not true. Though banks and NFBCs provide many new facilities to the people in 30s, there are some benefits of taking home loans in 40s and 50s.

Higher down-payments
People in their 40s and 50s are considered to be settled in their profession with significant savings by their sides. They can utilise these financial resources for the down-payment of home loan. Down-payments is one of the most critical factors of home loans. The higher the down-payments, the lower are the instalments on loan. Therefore, by paying high down-payments, the Generation X can reduce their home loan EMI.

Decreased tenure
Generally, financial organisations providing home loans like banks or NFBCs give 20 years of tenure to repay the loan. However, in the case of people over 40 years of their age, tenure of 20 years seems a bit extended from their retirement age. Thus, the bank approves the shorter tenure of 10 to 12 years to people in their 40s and 50s.

The option of prepayment
Pre-payment of home loan is a good option, as it reduces the span of the long-time financial burden. People in their forties and fifties are closer to their retirement, so the opportunity of pre-paying the mortgage comes to their aid. Nowadays, many banks charge zero or negligible amount while pre-paying home loans. Some may ask them for the penalty or minimum charges for the prepayment. Borrowers can take the help of tools like a home loan EMI calculators to plan EMIs.

Joint Home Loan
The age becomes a concerned factor while applying for a home loan when someone is in his/her 40s and 50s. Thus, people in their late 40s and 50s can borrow the home loan with a co-borrower, someone who is financially stable for a longer term.

Along with age, banks consider various factors before giving a home loan, like lifestyle, credit history, professional history, etc. Any individual in their 40s and 50s with a solid financial background can get a home loan. The above factors specifically clears the misconceptions about taking a home loan in the aforementioned bandwidth.

Latest Comments

Read Next

Bank vs. HFC: What Should You Choose for Your Home Loan?

Stamp Duty & Property Registration Charges in Chennai, Tamil Nadu

What is Prime Lending Rate? Meaning, Characteristics in Banking & Importance

Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.