Not all loans are bad loans; some offer us a chance to possess something which we could not have possessed otherwise. Home loan falls in that category. If the concept of home loans did not exist, most of us would not be able to buy a property. Despite being a huge financial liability, home loans offer us several benefits. For instance, a borrower enjoys tax benefits. Those who hate running their lives on credit would say all that comes with a cost. Yes, indeed --- You have to pay an interest on this loan which might run for a substantial part of your life. And, it would only be great if you could manage to buy a house without taking a loan.

If you are one of those lucky ones, here are certain precautions you must take:

• Before granting you the loan, banks dig deep into documents. For instance, your bank will refuse to grant you a home loan if the property titles are not clear. Banks have an expert team in place which work hard to find out all these details. As an individual, you might find it hard to find out all the big and small details about the property.

• Banks do a technical appraisal of the property to estimate its worth in the market. This gives you a fair idea about the money you should pay for the transaction. In case you are going to do the purchase without the help of a bank, you will have to hire an expert to do the job for you. Most of the times, consulting your neighbours on the point may just not be enough.  

• As you are not availing of a home loan, there are certain areas where you must increase your spending. Do not forget to recruit a good lawyer who would stick by your side through the property transaction. Also, consult a chartered accountant to understand the financial implications of the deal.

• Never pay the seller any money in cash, even if the amount is meagre. All the payments must be done through cheques or demand drafts. Do keep a record of all the payments you have made.

• Property deals where loans are not involved are likely to be completed quite quickly. This gives such buyer a lot a wriggle room. Try to strike a better deal for yourself; the seller may just be quite willing to oblige.