Buying your first home is challenging and exciting by turns. While zeroing in on the perfect home within budget is the easy part, gathering the money to finance the purchase is not. Like most people, you may depend on a home loan to pay for the house.

But did you know that the home loan is not available as soon as you apply for it? And that it pays only a part of the house’s value? You will need to gather all your reserves – savings, investments, cash gifts. You might still come up short,  that’s when you could opt for a personal loan  to settle the remainder amount. Read on to know how this works, and at what point you can apply for a personal loan to cover the down payment.

What your house payment breakup looks like

Buying your first home can become a challenge if you are unaware of the different stages for payment. For starters, you cannot get 100% home financing from any bank or NBFC in India – you can get a maximum of 80%. The remaining 20% must come from your pocket. This is what the payment breakup looks like:

  1. Token or booking amount: Usually Rs 50,000 to Rs 1,00,000.
  1. 1st payment on the house, usually 25% of the house’s value. This is paid upfront from your own reserves, and not from the home loan. Deduct the token amount already paid from this sum, and pay the remainder. You can now get the house agreement stamped and registered.  You could use your savings and/or also apply for an online personal loan to pay this sum.
  2. The house becomes eligible for a home loan only after stamp duty and registration are done. The lender takes about a month to check the property, your documents, residential and office address, credit score, etc. After this, the loan amount is disbursed to your account. However, you must pay for loan agreement registration and processing charges from your pocket.
  1. 2nd payment on the house is done at this stage, using the home loan money. The seller must settle any outstanding dues on the utilities. If all bills are paid, you can settle the final instalment and take possession of the house. Once you do, you must pay building society transfer and membership fees from your own resources.

From the above, it is clear that there are a few out-of-pocket expenses that the online personal loan can help you with. Applying for an online personal loan helps with them.


Applying for an online loan from a trustworthy loan app saves valuable time – you can pay for the house faster and secure the sale before the seller decides to approach other interested buyers. Thus, it helps you move into your dream home without having to wait to gather the down payment.

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