India Mortgage Rates

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The mortgage industry, also known as the housing finance industry is one of the most promising sectors of India of the past decade. Before viewing India Mortgage Rates , it would be worthwhile to have a brief introduction to the word "mortgage".

Mortgage is a conditional conveyance of property as security for repayment of loan. Such a property is put up as a collateral security which is liable to confiscation in the event of failure of repayment of the loan and the mortgage rate associated with it.

Hence, Mortgage Rate is a rate of Indian Mortgage Rates can be classified into two types:

  • Fixed Mortgage Rate
  • Flexible Mortgage Rate

Fixed Mortgage Rate is one in which the rate of interest remains fixed throughout the period for which the loan is taken irrespective of the other parameters like the principle paid, actual rate of interest and the time allotted for repayment. Interest rate is fixed to a previously notified rate which usually comes in increments of 12.5 % or 25 %. On the contrary, flexible mortgage rate is one in which the interest rate may "adjust" or "float" in coarse of time in accordance with the above mentioned parameters. For this reason, flexible mortgage rate is also known as "adjustable mortgage rate" or "floating mortgage rate". Interest rate is not tied to any index. A basic understanding of the mortgage rates in India and th economic influences that determine the future course of mortgage rates can help consumers in making financially sound mortgage decisions. Such decision may be whether to choose fixed or flexible mortgage rate or to refinance out of the latter.

Some kinds of mortgage loans include:

  • Interest only mortgage
  • Graduated payment mortgage
  • Negative amortization mortgage
  • Balloon payment mortgage

Last Updated on 5/26/2011