Buying a home is a milestone — and often one of the costliest investments of your life. While most homebuyers focus on interest rates, the real costs usually hide in the fine print. From surprise fees to compulsory insurance myths, knowing what to watch for can save you lakhs.
Sujit Bangar, founder of Taxbuddy, shares six practical hacks every borrower should know before signing home loan papers.
1. Hidden Charges After Sanction
Many banks disclose only part of the cost upfront. Processing fees, legal, technical, valuation, and documentation charges often appear after approval.
Bangar advises asking for a detailed cost breakup sheet. If a bank refuses, remember that RBI regulations require full disclosure.
2. The “Compulsory” Insurance Trap
Banks sometimes pressure borrowers into purchasing expensive insurance just before disbursement. Policies worth 4% of your loan are not mandatory, yet RMs may push them at the last minute.
Pro tip: Apply to multiple banks simultaneously to maintain leverage and avoid undue pressure.
3. Use Joint Loans to Maximize Tax Benefits
A joint home loan with your spouse or parent can double your deductions:
Section 80C: Rs 1.5 lakh per borrower on principal
Section 24: Rs 2 lakh per borrower on interest
This can total up to Rs 7 lakh in combined annual tax savings.
4. Lower Stamp Duty for Women
Registering a property in a woman’s name can reduce stamp duty in states like Delhi and Haryana. For example, a Rs 1 crore property could save nearly Rs 2 lakh in registration fees.
Bangar cautions buyers to consider succession implications before making this choice.
5. Always Verify RERA Details
Before paying the builder, check the project on the state RERA portal. This helps identify pending approvals, litigation, or construction delays.
Ensuring the builder’s credibility through RERA can prevent long-term legal and financial headaches.
6. Never Take Possession Without an Occupancy Certificate (OC)
Moving into a property without an OC can lead to penalties or eviction notices. Bangar advises insisting on the OC before taking possession, and escalating issues through RERA if it isn’t issued.
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