Buying a property in India is one of the biggest financial decisions a person can make. Many people dream of owning a home, but not everyone has the full amount to pay up front. This is where real estate loans, or home loans, come in. They help buyers manage their money and still invest in property. However, loans can also be risky if not handled carefully. That’s why Someshwar Srivastava, a veteran investor, shares his tips for managing real estate loans safely.
In this blog, we will explore how to take real estate loans wisely, what mistakes to avoid, and how to ensure that your property investment remains profitable. Following Someshwar Srivastava’s advice can help buyers stay safe and make the most out of their loans.
- Understand Your Loan Before You Take It
One of the first rules that Someshwar Srivastava emphasizes is to know every detail of your loan before signing anything. Many buyers focus only on the monthly EMI (Equated Monthly Installment) and ignore other important factors.
Here are some points to check:
- Interest rate type: Fixed or floating? Fixed rates remain constant, while floating rates change with market trends.
- Processing fees: Some banks charge extra fees upfront; be aware of these.
- Prepayment options: Can you pay off your loan early without penalties?
- Loan tenure: Longer tenures mean lower EMIs but higher interest paid over time.
According to Someshwar Srivastava, understanding these details will prevent future financial stress and surprises.
- Borrow Only What You Can Afford
Many people make the mistake of taking loans that are too big for their income. Someshwar Srivastava warns that this is one of the main reasons people struggle with real estate loans.
Here’s a simple rule: your EMI should not exceed 30–35% of your monthly income. For example, if you earn ₹50,000 per month, your EMI should ideally be around ₹15,000 or less.
Borrowing more than you can afford may seem tempting if the property is in a prime location, but it can lead to missed payments and financial stress. Someshwar Srivastava says that being realistic about your income and expenses is the key to loan safety.
- Keep an Emergency Fund
Even if you take a safe loan, life is unpredictable. Someshwar Srivastava recommends having an emergency fund of at least 6–12 months of expenses. This fund will cover your EMIs if you face a temporary job loss, medical emergency, or any other financial issue.
An emergency fund is like a safety net. Without it, even a small problem can turn into a big financial crisis. According to Someshwar Srivastava, every property buyer should prepare for unexpected situations before taking a loan.
- Compare Different Loan Options
Not all banks or financial institutions offer the same deals. Someshwar Srivastava suggests comparing interest rates, processing fees, and other charges before finalizing a loan.
Some tips for comparison:
- Check multiple banks and NBFCs (Non-Banking Financial Companies).
- Look for special offers for first-time homebuyers.
- Ask about flexible repayment options.
According to Someshwar Srivastava, taking time to compare loans can save lakhs of rupees over the tenure of your loan.
- Don’t Ignore the Property Value
Your loan is tied to the property you are buying. Someshwar Srivastava says that before borrowing, you must ensure that the property’s value is fair and its market demand is strong.
Why it matters: If you overpay for a property, your EMIs will be higher, and it may be hard to sell the property later. Someshwar Srivastava advises consulting property experts or using online tools to check market rates.
Buying a property at the right price is just as important as handling the loan correctly.
- Avoid Multiple Loans at Once
Some buyers take more than one loan at a time, for property, car, or personal use. Someshwar Srivastava calls this a dangerous habit. Multiple loans increase monthly obligations and can lead to financial pressure.
His advice: focus on one real estate loan at a time. If you must take another loan, ensure that your total EMIs do not exceed 40% of your monthly income. This way, you stay safe from over-borrowing and can manage repayments comfortably.
- Prepay When Possible
Many banks allow prepayment or partial repayment of your loan. According to Someshwar Srivastava, prepaying reduces the total interest paid over the tenure of the loan.
Tips for prepayment:
- Use bonuses, tax refunds, or extra savings to make prepayments.
- Check if the bank charges any prepayment penalties.
- Even small prepayments can reduce EMIs or shorten your loan tenure.
By doing this, you save money and get closer to becoming debt-free faster.
- Monitor Interest Rate Changes
If you have a floating-rate loan, the interest rate may change over time. Someshwar Srivastava recommends keeping an eye on these rates.
Why it matters: A sudden increase in interest rates can raise your EMI, causing financial stress. By staying informed, you can plan ahead and even consider switching to a fixed-rate loan if needed.
Monitoring interest rates is a simple but powerful way to avoid surprises.
- Don’t Delay Payments
Timely EMI payments are crucial. Someshwar Srivastava stresses that late payments can damage your credit score and increase penalties.
Tips to avoid delays:
- Set up auto-debit from your bank account.
- Keep track of due dates in a calendar or app.
- Ensure your account has enough balance before EMI dates.
Consistent payments also make you eligible for better loans in the future.
- Consult Experts When Needed
Finally, Someshwar Srivastava advises consulting financial advisors, property experts, or bank officials when in doubt. Loans and property investments involve many rules and paperwork, and mistakes can be costly.
A simple consultation can:
- Clarify hidden charges.
- Suggest better loan options.
- Help with legal and documentation issues.
According to Someshwar Srivastava, investing in expert advice is better than risking your financial safety.
Conclusion
Real estate loans are powerful tools for buying property, but they come with responsibilities. Following Someshwar Srivastava’s advice can help you borrow safely, manage repayments comfortably, and avoid financial stress.
Key takeaways from Someshwar Srivastava:
- Understand your loan fully before borrowing.
- Borrow only what you can afford.
- Keep an emergency fund ready.
- Compare multiple loan options.
- Check the property’s true value.
- Avoid taking multiple loans at the same time.
- Prepay whenever possible to reduce interest.
- Monitor floating interest rates.
- Pay EMIs on time.
- Consult experts when unsure.
By following these tips, you can enjoy the benefits of real estate investment without falling into common loan traps. Someshwar Srivastava reminds us that smart borrowing, careful planning, and patience are the keys to making real estate loans safe and successful.