Taking a home loan can be a challenging and time-consuming process if you do not already have the basic prerequisites for the loan. While the requirements can vary between lenders of home loans in India, there are a few things that are common to all the lenders. If you are planning to take a home loan, ensure that you have these five things with you.
Getting a home loan is easier said than done. While the lenders in India have made the process significantly simpler than what it used to be a decade ago, it can still be confusing for people taking a loan for the first time. There are a number of things related to your eligibility, the property you want to buy, documents, etc. without which you cannot get a home loan.
If you are planning to take a home loan, ensure that you do have these five things with you-
- Right Documents
You’ll surely need a lot of documents to help the lender confirm your identity, address, and salary. Right from residence proof, ID proof, salary statement, bank account statement, to ITR, you’ll need many different types of documents to apply for the loan successfully. Check the document requirements of the lender for home loans in India before applying to make sure that you have all the right documents at the time of applying.
- Credit Score
The lenders also have eligibility requirements, on the basis of which they approve and reject home loan applications. One of the most important considerations for the lender is your credit or CIBIL score. The CIBIL score is your credit history, and it needs to be above 750 to be eligible for a home loan. Ensure that you do check your CIBIL score before applying to make sure that your loan application is not rejected.
- Approved Property
You’ll also be required to submit a number of documents related to the property that you’d like to purchase. It is important to know that not every lender would offer loan to buy a house in any real estate project. The project should be from a reputed developer as lenders usually only approve projects from developers with a good reputation in the industry.
- Additional Documents in Case of a Resale House
If you are planning to buy a resale property, a property which already has an owner, the property would be verified by the lender from all the possible legal angles to ensure that it is free from any kind of encumbrances. Some of the additional documents that you’ll need include are immediate title deed, agreement to sell, society NOC, share certificate, occupancy certificate, and encumbrance certificate.
- Down-payment Amount
Once the loan application is approved, you’ll be required to pay the down-payment as well. Lenders usually offer 80%-90% of the cost of the home and the remaining 20%-10% is to be paid by the pair in the form of down-payment. You cannot get the home loan if you are unable to pay the down-payment amount.
While applying for home and getting the loan application accepted is now easier, there are still a lot of things that a borrower needs to keep in mind when applying. Remember these five things when applying for the home loan to avoid getting rejected by the lender.