How to get money for home loan downpayment?
Here are some other ways you can raise money for your down payment.
Planning And Budgeting - Buying a house needs planning that has to be done well in advance. Arranging the down payment is a long-term project and it needs a good deal of discipline and dedication. You can save for it through investment instruments such as Mutual Funds, Fixed Deposits etc. You must pick an instrument based on the amount of time you have in hand. Say, you want to buy a house after three years and the down payment you would need at that time is Rs. 10 lakhs. You can start by investing Rs. 25,000 per month in an Equity Mutual Fund through Systematic Investment Plan. With return of 12% p.a., you would have saved more than Rs. 10 lakhs within three years.
Borrow From Family And Friends - If you are not ready with your down payment at the time of buying a house, you can borrow from a friend or relative for a short period. However, go for it only when you are falling short by a small amount. Make sure you have a repayment plan in place before you borrow from your friends and family.
Take a Personal Loan - The relatively high interest rates attached to Personal Loans is a significant deterrent to using this financial product as a method to finance the down payment on a Home Loan. Another disadvantage of using Personal Loans as a way to fund the down payment is that there are no tax benefits on taking a Personal Loan for a down payment on a Home Loan. For these reasons, a Personal Loan should ideally be your absolutely last resort when arranging finances for the down payment.
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