Facts Related to Home Loans in India

Dev Singhraha

Relocation Expert

Home loan is a certain amount of loan given in advance to an individual in order to help him buy or build a house or apartment. A home loan is a secured loan. This type of loan is given to a borrower against the security of the property for which the bank is giving the loan. The property could be personal or commercial. If the borrower fails to return the lent out money within the stipulated period of time, then the bank has every right to sell the concerned property. In this way, the banker of the particular bank gets conditioned ownership over the concerned property.

Hence, it gets very crucial that you are aware of the following facts before applying for a home loan in India.

The most important criterion for getting a home loan is that: you have to occupy a guaranteed job from which you draw a sufficient amount of salary. You must collect Form 16 from your employer. If you have fulfilled these conditions, you can apply for a home loan.
As an applicant’s credit card history is taken into consideration. So it is very important for you to have a good Cibil score.
You need to prove your loan repayment capacity to the bank before acquiring the loan.
While providing home loans to an individual expense like stamp duty, service tax, value added tax and other legal charges are not taken into consideration. Only the cost of the property and the car parking area would be considered.
After all the required documents have been submitted, a salaried person gets the approval and sanction of the home loan in 5-7 working days whereas a self-employed person gets in 10-15 days. If all the income verifications have been cleared the bank will grant conditional sanction of the loan within 5-15 days. Once the sanction letter is handed to the borrower, the loan amount would be disbursed within 2 days.
Although it is very difficult to pay two simultaneous loans at the same time, checking other options is not a bad idea. But remember, whenever you would be applying for a loan, the particular bank will check your other loans and only when you are capable of repaying you would granted another one.
Bank demands a set of documents at the time of seeking a loan. This should be meticulously presented because you will not get the loan otherwise.
The charges are Processing fee, Application fee, Administrative fee, Legal fee, Notary fee, Documentation fee, Prepayment charges, late demand charges, Loan switch charges, Franking fee on loan and sale agreement. However, all these charges are not applicable to all the home loans.
If your property is built by a renowned developer, then it would be very easy for you to get the loan. On the contrary, if you are planning to buy a resale property, you might face problems in getting loans.
It would be wise of you to pay a down payment of 20% of the total loan amount. This amount is in fact demanded by the banks and the financial institutions from which you would be seeking a loan.

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