You’re probably aware that Life Insurance Corporation Housing Finance Limited (LIC HFL) is a major house loan lender. Did you realise, though, that LICHFL isn’t a bank? Housing Finance Corporation is what LIC Housing Finance Limited is (HFC). HFC vs Banks: Who Wins? is a good place to start if you’re new to the world of house financing. Continue reading if you’re already familiar with these concepts. LIC HFL is so popular for house loans because it has a good understanding of its customers and it is much easier to secure a loan from LICHFL than from other lenders. Let’s have a look at the advantages it provides:
Benefits of LIC Housing Finance Home Loan
1) It is adaptable in terms of documentation.
The documentation required for a house loan application are less stringent at LICHFL. Consider this: most lenders are very strict regarding the home’s ‘Occupancy Certificate.’ Furthermore, the OC must be obtained exclusively from the Municipal Corporation or Magistrate’s office. LICHFL, on the other hand, issues loans based on Gram-Panchayat OCs, and in some situations, the loan is approved without the OC. This is really unusual for a lender to do, and it is one of the main reasons why customers pick LICHFL.
2) It is not constrained by your CIBIL score.
A low credit score during loan approval is like a bad score during 11th grade admissions: it’s a nightmare. Most lenders will not authorise a loan unless the credit score is in the 700s. Rajesh Mandavkar, one of SwitchMe’s customers, had a difficult situation that LICHFL was able to address. Rajesh had taken out a 12Lc home loan with IndiaBulls, but when he requested a 13Lc top-up loan, IndiaBulls turned him down. His poor CIBIL score of 650 was the basis for his rejection. He applied for a loan transfer with HDFC, and his application was unexpectedly approved.
HDFC granted a loan of 25 Lc, however they cancelled it at the last minute due to a mistake with the documentation. Naturally, his CIBIL score plummeted even further, falling below 600. A credit score of 500 or below is regarded extremely low, and obtaining a home loan is practically difficult. When Rajesh contacted SwitchMe, he was in a desperate condition. Our Home Loan Advisor recommended transferring the loan to LICHFL, which agreed to sanction his loan after further enquiry!
3) LICHFL provides you with a high level of loan eligibility.
When you apply for a house loan, the lender will determine your loan eligibility, or how much money you can borrow. This amount is determined by taking into account your salary, age, education, credit score, and other factors. When it comes to loan eligibility, LICHFL frequently favours the applicant, approving a larger credit sum than most lenders. LICHFL is a good fit for first-time home loan customers in general, according to our research. However, we recommend that you proceed with caution. While LICHFL can be beneficial to the borrower, it does come with a cost.
Long-Term Loss with a Short-Term Gain
Many people looking for house loans are attracted to LICHFL because it offers a bigger loan amount and is less stringent with its application standards. However, once the loan is approved and repayment begins, these individuals frequently discover that the service quality has deteriorated significantly. They are required to visit the bank to perform minor procedures, are charged hidden costs, and are not provided with timely loan information. The Interest Rate is the mother of all problems. lic hfl home loan rate can reach astronomical heights when the house loan enters the floating-rate period. The rate is currently at 11.5 percent, but it has the potential to rise to 12.5 percent!