Want To Get A Home Loan? Here’s What You Must Do

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Want To Get A Home Loan? Here’s What You Must Do

Whatever your reason be, a home loan is the best way to fulfil your dreams

Wednesday April 15, 2020 3:45 PM, ummid.com News Network

Home Loan Step by Step Process

People take home loans for various reasons. They may use the amount for buying a piece of land, constructing a new house, renovating the house, or carrying out repairs. Whatever your reason be, a home loan is the best way to fulfil your dreams.

It is good to know about the requirements before you decide to apply for home loan. This article informs you of everything you need to do to get a home loan.

How Much Loan Amount Can I Get?

The loan amount depends on your net monthly income minus fixed expenses. It also factors in your family income as well as your assets and liabilities. The loan amount depends on the surplus income you can pay as EMI.

Typically, lenders consider that you can repay 50% of your net monthly income.

Once the lender decides the loan amount, you need to pay ten to twenty per cent of the amount as a down payment. The higher the down payment, the lower will be the interest.

Use a home loan calculator and key in details such as loan amount, ROI, and tenure to calculate your monthly EMI.

Do I Need A Co-Applicant?

Yes, you need a co-applicant. If you are buying the property with someone else, that person will be the co-applicant. If you are applying for a home loan all by yourself, someone from your family needs to be the co-applicant.

What Documents Do I Have To Submit For Loan Approval?

At first, you need to collect the home loan application form from the lender. Most lenders upload the form online. All you need to do is to visit the downloads section on the lender's website, download the form, and take a print-out.

After carefully filling out the application form, you need to attach the following documents along with the application form.

i. PAN Card
ii. Identity Proof
iii. Address Proof
iv. Previous two months' salary slips (for salaried professionals).
v. Income tax return or Form-16 (for self-employed)
vi. 6 months' bank statement or balance sheet.
vii. Copies of property documents (as applicable), such as Agreement, Allotment Letter, Buyer Agreement, and payment made to the developer.
viii. Photographs (passport size).

After you submit the documents, the lender will evaluate your profile and may request you to deposit some collateral security, such as insurance policies, fixed deposits, units of mutual funds, or NSCs.

When Will I Receive The Loan Amount?

After you submit the application form with the documents, the lender verifies it. If your loan gets approved, the lender sends you a sanction letter. It contains details like the loan amount, interest rate, tenure, and other terms and conditions.

The sanction letter mentions the maximum loan amount you are eligible for. You may, however, reduce the loan amount according to your requirements.

When you and the lender mutually agree with the amount, interest rate, and tenure of the loan, the lender disburses the loan amount. Lenders calculate EMI from the date of disbursement, not sanction.

How Do I Need To Pay The EMI?

You may pay EMI by ECS, by deduction from salary, or by issuing post-dated cheques.

Conclusion

A home loan is popular in India because of two reasons. First, it gives you a place to call your own. Second, it offers income tax benefits under Section 80C. Before choosing the lender, make sure it is reputed, offers longer tenure home loans, is AA+ rated, and provides flexible repayment options.

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