Top-up Loan
An additional borrowing option for existing home loan borrowers, allowing access to extra funds for various purposes with simplified documentation and competitive interest rates.
EMI
Equated Monthly Installment is a fixed payment amount paid to lenders every month, comprising both the principal amount and interest, ensuring structured repayment over a specified period.
CIBIL Score
A three-digit numeric summary of a borrower's credit history, used by lenders to assess creditworthiness. Higher scores typically result in faster approvals and lower interest rates.
Interest Rate
The percentage charged by lenders for borrowing money. It directly impacts the total cost of the loan and the monthly payment amount.
Floating Interest Rate
Also known as a variable rate, this interest rate fluctuates based on market conditions, potentially leading to changes in monthly payments over the loan tenure.
DTI Ratio
The Debt-to-Income ratio compares an individual's monthly debt payments to their gross monthly income, helping lenders assess the ability to manage new loan payments.
Down Payment
An initial upfront payment made by the buyer, usually a percentage of the property's purchase price, reducing the total loan amount required.
Disbursement
The final stage where the lender releases the loan funds to the borrower or seller after all legal and technical verifications are completed.
Processing Fees
Charges imposed by lenders to cover administrative costs, document verification, and credit checks associated with processing a loan application.
Foreclosure
The act of repaying the entire outstanding loan amount before the scheduled end of the tenure, usually to save on long-term interest costs.
LTV Ratio
Loan-to-Value Ratio is the percentage of the property's value that a lender is willing to finance. A lower LTV typically indicates lower risk for the lender.
Prepayment
The act of paying a part of the loan amount before the due date, which helps in reducing the principal balance and the overall interest burden.
Moratorium Period
A specified period during the loan tenure where the borrower is not required to make any EMI payments, often provided for under-construction properties.
MODT
Memorandum of Deposit of Title Deed is a legal document where the borrower confirms the deposit of property documents with the bank as security for the loan.
Loan Tenure
The duration for which the loan is sanctioned. Home loan tenures in India typically range from 5 to 30 years.
