Home Loans
Need Home Loan?
Owning a home isn’t just a keystone of wealth, it’s what gives us and our families, stability and emotional security. If you’re hesitant about buying a home because you feel that getting a home loan is a daunting task. Don’t worry! Applying for a home loan, is an incredibly simple process.
Home loan is a loan disbursed by a bank or financial institution (lender) to an individual specifically for buying a residential property. Here, the lender holds the title of property until the loan is paid back in full along with interest.
What are the Documents required for Home loan?
- Completed Loan Application
- 3 Passport size photographs
- Proof of identify (photo copies of Voters ID card/ Passport/ Driving
- Proof of residence
- Property tax receipt/ Passport/ Voters ID card)
- Proof of business address for non-salaried individuals
- Statement of Bank Account/ Pass Book for last six months
- Signature identification from present bankers
Frequently Asked Questions ?
Yes. Resident Indians are eligible for certain tax benefits on both principal and interest components of a loan under the Income Tax Act, 1961.
Prior to full and final disbursement and commencement of EMI, you pay pre-emi interest on the portion of the loan disbursed to you. Pre-EMI interest is payable every month from the date of each disbursement up to the date of commencement of the EMI.
Banks do not allow co-borrowing between friends. It is only a family member who can be your co-applicant in your home loan application. Even between family and relatives, banks have reservations in granting loans. For instance, a married woman would find it difficult to avail of a home loan making her unmarried sibling a co-applicant. Banks generally prefer lending to spouses as co-borrowers.
Your age and your income are the primary criteria for the bank to decide your credit eligibility. For instance, a bank would be more willing to a younger person, earning a stable monthly salary. Such profiles have lower risk exposure.
You can change your lender multiple times, in case it helps you reduce your loan burden. However, too much shifting is not advisable as it sends across a wrong impression. Also, kept in mind must be the fact that banks charge a free on loan transfers.
A borrower does not have to pay a penalty on pre-payment after the Reserve Bank of India in 2013 directed financial institutions to waive charges for loans taken on floating rate of interest. However, banks still charge a penalty on transfer if you have taken a home loan on a fixed rate of interest.
The answer is no. Banks generally offer only 80 per cent of the total worth of the property as loan. Further, the amount you could borrow from the bank is decided only after banks carry out a technical valuation of the property. If you are asking for a loan of Rs 30 lakh while it is worth only Rs 25 lakh according to the bank’s estimates, it would offer you only Rs 20 lakh as loan.
Banks do not allow co-borrowing between friends. It is only a family member who can be your co-applicant in your home loan application. Even between family and relatives, banks have reservations in granting loans. For instance, a married woman would find it difficult to avail of a home loan making her unmarried sibling a co-applicant. Banks generally prefer lending to spouses as co-borrowers.
In case you have a poor credit score, you will find it difficult to get a home loan. However, you can improve your chances by getting a co-borrower. The co-borrower needs to be a family member like your spouse or parents. Ideally, you should choose a co-borrower who has a regular source of income and good credit history to bolter your chances of a successful application.
Banks charge a late-payment fee upon each such occurrence. In case of an unfortunate event owning to which you are not able to repay your loan, the bank will have the right to possess the property and auction it to recover losses.
