India is the key country where a person is witnessing the rising global market, and people from different parts of the country and flocking to the cities to find and do work and make a living. To make this transition sustainable, there is a latent need for housing, which needs to be met to hold the large population of the city in that place.
As per the financial stability report by the RBI, we can witness a rise in housing loans by 14.2% as of March 2023, and the recent growth has come from the young home buyers who are taking home loans to get a house in the semi-urban area from that place a person can go to work.
In this blog, we will look into some changes brought by housing finance companies that make residential living a reality in the country’s semi-urban and urban areas.
How Housing Finance Companies Working as a Catalyst
The rise of urban housing companies is the game changer when it comes to the growth prospect of a city as it’s these companies that are making houses afdfordable with flexible loan plans.
It allows the builders to expand their portfolio of affordable housing, and through that one can get further growth propelled by the housing finance companies. To get a housing loan, one can take the help of a loan agent app, and there, one can get all the information regarding that loan.
Apart from that, there are government schemes such as Pradhan Mantri Awas Yojana and other schemes which also promote the housing needs of people in semi-urban areas. The rise of affordable and long-term housing loans and budget-friendly homes makes it possible in certain areas of the city to have affordable houses.
The Rise of Financial Inclusion and Its Relation With Home Ownership
Financial inclusion plays a key role in increasing home loans among young borrowers, and for that, the young borrowers are guided toward their needs themselves. They can get loans from the digital lending wings of the banks, which makes them homeowners.
For example, due to financial inclusion, some people can now afford home loans for a longer time frame and can reside in a place where they get the chance to live and go to work from the urban centers of the state.
Due to the rise in financial inclusion, the credit penetration in the country has increased, and that has led to the rise of home ownership in the current state. The new HFCs have modernized their approaches, and therefore, people don’t need to depend on banks as they can get loans from housing finance companies.
The Approach Towards Tailored Loan Products
The approach of modern HFCs and banks is to customize the loan product for the individual, and depending on the cost of their properties, people can now take loans and customize that through an approach where the cost of the loan will not be heavy on the borrower.
This tailored approach is something where one can comfortably meet the lender’s obligations which reduces the loan default chance of the borrower. This approach towards the borrowers also allowed them to maintain their consumption patterns, as home loan installment payments don’t affect the livelihood of the borrower.
The Transformation Towards Digital Services
The transformation in digital services and products has made the loan approval process faster and more efficient. The fast and quick adoption of digital technology and infrastructure has changed how loans used to be disbursed previously.
For example, a person who is taking the housing loan can access the HFCs app without visiting the branch and, therefore, can get a loan approved without the hassle of visiting the center multiple times.
One can also take help from a business loan agent when they want to invest in commercial real estate such as a retail space or other areas where one wants to start their business. One of the biggest challenges of knowing the details of the customer or the borrower has been removed by taking the process digitally.
The change in the loan approach by the housing finance companies allows the real estate sector to grow and benefit from the rising demand in the urban community.