Common Complications After Taking A Home Loan And How To Deal Them?

Buying the house of your dreams is one of the most significant financial decisions you will make. And to afford their dream house, people mostly opt for a home loan. Although a home loan can have numerous benefits, there are several common complications that can arise after taking out a home loan, and it is important to be aware of them so you can take steps to prevent or mitigate them.

This article is intended to fill the gaps and help understand the roadblocks borrowers go through after taking a home loan. We will also discuss how to deal with them in great detail.

Common Problems After Taking a Home Loan

Taking up a home loan involves several steps, official documents, verifications, etc., and can be lengthy. However, in the end, it is a financial support system that takes you closer to your dreams. You may encounter the following unforeseen circumstances or complications after taking a home loan:

1. Demise Of The Borrower

The passing away of a home loan borrower can indeed be sad news. However, the first thing to understand here is to check if insurance was in place.

Many NBFCs provide insurance policies to borrowers at the time of providing a loan. Therefore, after the borrower's demise, a lump sum amount is released to the family based on the terms and conditions mentioned in the policy. This amount can be used to repay the home loan, and the family members can continue to live in the same house.

2. Natural Disaster

Natural disasters like fire, earthquake, and other calamities are unforeseen events. If the house you took a home loan for is affected by a natural disaster, you will have to pay the mortgage. The impact of a natural disaster can be devastating, but you will still be under the obligation of paying the home loan.

4. Family Dispute

A family dispute can lead to the division of the house, and if the home loan is unpaid, it can cause even more trouble. The loan amount can be divided if the home loan is a joint loan, based on everyone's contribution to the property. So, as a family, a decision has to be made on the repayments.

How to Deal With Home Loan Complications?

There are many ways to deal with home loan complications. Here are the top ones:

1. How to Deal With Home Loan After Demise Of The Borrower?

A prominent way of dealing with this complication is checking if an insurance policy is made against the property.

If an insurance policy is out of the picture, look for the details of the co-applicants. The co-applicant must pay off the outstanding loan amount if it is a joint loan. The failure to do so can escalate matters quickly, and the lenders can directly reach legal heirs or family members. The only aid that the financers can offer is to restructure the terms.

2. How to Deal With Home Loan Complications After Natural Disaster?

In case of a natural disaster, claim for insurance if your house is insured. Reach out to government organizations for assistance.

Alternatively, a mortgage forbearance can help too. Get in touch with your lender and explain the situation to them. Forbearance will give you the flexibility to address the crisis in the short term and tackle the hardship.

3. How to Deal With Complications Of Home Loan In Case Of Divorce?

After divorce, the wife can claim a stake in the property only if the registration made is "joint." The court will do the needful and grant her the share after a divorce.

Another option is to ask your lender to remove your name from the loan, which can be questionable and depend on other underlying factors. The next alternative is to buy the remaining share of the house and become the sole buyer of the property.

4. How to Deal With Complication Of Home Loan On Family Dispute?

If there has been a family dispute after a home loan, the middle ground to deal with is to pay off the loan of the bearer. If the loan is joint, everyone must keep on repaying the loan even after the dispute. Failure to do so can lead to property seizure.

Conclusion

The article summarizes the common complications after taking a home loan that most borrowers face after a home loan. The only way to avoid these problems is by staying alert and taking the required precautions, which will make the loan process hassle-free.

Applying for a home loan with SMFG Grihashakti will bring you closer to buying your dream house. Home loans up to INR 5 crores* to everyone eligible, along with affordable interest rates and flexible terms up to 30 years, make it easy for you to take a step towards your dream home. Check your EMI obligations through our online EMI calculator for home loans. Apply for a home loan online to avoid complications and get what you want concerning your dream house!