So you are all set to buy your dream property and think that you have everything in control. Well, you need to think again as there are a set of hidden costs that you must consider while finalizing your finances for buying your dream property.
There are a set of hidden charges which are an integral part of the overall process of buying a property and most importantly, all the hidden charges are not covered in the home loans, so if you are solely dependent on home loans, then it is very important for you to clearly understand these hidden costs while buying a property
What are these hidden charges?
Here are some of the important hidden charges that you must look at while deciding the financials for your property purchase.
First and foremost is the set of additional infrastructure charges, which are given as part of the extra facilities that customers select and this include, parking facility, garden area, usage of swimming pool and play area etc.
These charges are also termed as preferential location charges (PLC), External Development costs (EDC) etc. which constitute of up to 5 to 10 per cent of the total cost of the property. In addition to this, there is also an additional charge of onetime parking to facilitate the parking of a car as part of an individual’s property.
In addition to these charges, there are charges related with the new electricity and water connection that come along with the living inside the particular unit. These are charged separately from the home buyer and this charge ranges from Rs. 20,000 to Rs. 25,000. All these charges need to considered in order to make a clear understanding of your finances while buying a house.
In continuation to our efforts towards educating yourself on the hidden charges while purchasing a property, here are some more critical points to remember and make note while you finalize your finances for the real estate purchase.
Maintenance and Social Charges
This is first and foremost and becomes important to consider if you buy an apartment which comes inside a residential complex, the maintenance charges are usually collected as an additional cost and are not included in the loan amount sanctioned to you by the banks.
The maintenance charges include the repair costs of the apartment, water and power maintenance for the apartment. It also includes the charges for cleaning the common area and garden, security charges, maintaining the driveways and maintenance of common roads as well.
Stamp Duty Charges
The stamp duty is another important investment that needs to be taken into account while deciding the final investments. This is a tax which is given to the government towards registering the property. The stamp duty is calculated based on the area and cost of the property, as well as the valuation of the land.
Home Loan processing Fee
This forms another of the hidden charges while securing the home loan, According to most of the Indian banks, this processing fee usually hovers around the 0.3 to 2% mark from the loan amount. And most importantly, it becomes important to note that if a customer opts for floating type of home loan, then the customer needs to pay extra cost if the floating rates changes. And hence, it is advisable and a safer option to go for fixed interest rates.