There are many dangerous pitfalls behind the luster of attractive home loans. If you’re a loan-taker and haven’t known the traps, now is the time to wake up. Sample the following story from The Telegraph (excerpt):
Two years ago, Arun D’Souza took a Rs 18.45 lakh home loan at a floating rate of 7.25 per cent. The loan tenure was 20 years and his equated monthly instalment (EMI) was a little over Rs 15,000. Interest rates have been creeping up since but D’Souza chose to pay the same EMI. The interest rate has since risen to 9.75 per cent. Last week, the marketing executive found out by accident while doing the paperwork for income tax that the loan tenure had swelled to 50 years!
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