India Mortgage Rates

Financial institutions such as banks, both in the public sector as well as in the private sectors and cooperative societies mainly function as mortgage lenders. Mortgage lenders provide loans against real estate, that serves as the security for the loan.

In the event of the failure of the borrower to pay off the loan amount, the mortgage lender reserves the right to seize, sell and recover the loan amount through the collateral of the borrower. In order to avoid such circumstances the borrower is required to pay off a specified or agreed sum of money at regular intervals.

Mortgage lenders lend money at two by using two procedures i.e the fixed rate mortgage and adjustable rate mortgage. Through the application of the fixed rate mortgage, the money lender gives out the money at fixed interests for the entire loan period whereas with the aid of the variable or adjustable rate mortgage, the money lender gives out the money initially at a fixed rate of interest for a specific period of time but after the completion of that period of time alters the interest rate according to the market indexes.

Mortgage lenders have to maintain records of all the essential informations regarding the facilities provided under the mortgage, price of the mortgage, repayment plan, interest levied and so on. The mortgage lenders offer a number of choices to the borrower to pay off their loans. The normal procedures followed for the repayment of a mortgage is the repayment of both the capital and the interest. The interesting variation of this procedure of repayment is the no capital or interest repayment. Mortgage lenders have also incorporated the special repayment plan which involves the repayment of only the amount of interest. The variation to this repayment method involves the payment of the amount of interest, without the full payment of the principal amount.

Mortgage lenders caters to the different mortgage requirements of the borrowers and therefore they continue to incorporate new mortgages plans. Some of the mortgage plans are:

• Budget loan
• Assumed mortgage
• Jumbo mortgages
• Blanket loan
• Commercial loan
• Balloon mortgage
• Reverse mortgage
• Negative amortization loan
• Bridge loan
• Buy down mortgage
• Seasoned mortgage
• Non-conforming mortgage
• Equity loan
• Foreign national mortgage
• Participation mortgage
• Term loan or interest-only loan
• Graduated payment mortgage loan
• Hard money loan
• Repayment mortgage
• Package loan
• Participation mortgage
• Wraparound mortgage
• Repayment mortgage
• Seasoned mortgage

Prominent mortgage lenders of India include banks like State Bank of India, Citibank, HDFC, ICICI, HSBC and so on.

Last Updated on 5/26/2011