While purchasing a car or a home or may have come across the question "How much down payment for home?" And you have wondered what the question means. Well, when you purchase a car or house, you have to pay a percentage upfront to book it. So, this initial payment to buy something expensive on credit is called a down payment.
Not all of us can purchase a home without taking a home loan. Therefore to apply for the home loan, we have to pay some amount upfront. Even if the bank does not want any down payment it is better to make a down payment as it will help you save on interest. Therefore you should understand the process of how much down payment for a house if you are thinking about purchasing a property.
How much is a down payment on a house?
When you are purchasing a home it is better to pay at least 15% - 20% of the price of a property when you are availing a home loan. After paying some portion amount upfront you can pay the remaining loan through EMI or equated monthly instalments.
When you approach a bank for lending money the bank specifies the amount for the down payment. If you could pay a large down payment you will be able to pay the instalments comfortably at a lower interest rate.
I will show you an example about how much down payment for house you need
Suppose you purchased a house for Rs. 50,00,000.
Now you need to make a down payment of 20% that is Rs. 50,00,000 x 0.2= Rs. 10,00,000
The bank would approve the home loan of Rs 40,00,000.
The processing fee for 1% loan amount is Rs 40,00,000 x 0.001= Rs. 40,000.
So the answer for how much should you put down on a house becomes Rs 10,00,000 + Rs 40,000= Rs. 10,40,000.
Therefore the down payment for the home is 10.4 lakh.
I hope I was able to clear your doubt about how much down payment for home.
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Read more:
How much home loan can I get on 30000 salary?
How much home loan can I get on 25000 salary?
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How much down payment for home?
Rajlaxmi
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4 Year
2021-11-29T18:00:10+00:00 2021-12-01T10:38:26+00:00Comment
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