Anyone who is willing to take a home loan must be wondering how long and complex the procedure would be. You will be glad to know that to own your dream house is not a long difficult task anymore. With the rising number of banks and NBFCs, each one has taken certain steps to survive in these competitive market. These steps have served as a boon to us customers because they have simplified the procedure. Apart from that, the lending institutions also tip-toe with the applicants to get everything done for them. There is hardly any bank or NBFC that do not cooperate with their clients or guide them throughout the loan procedure.
Still, if you are willing to do your homework before contacting any financing institution, then we are here to help you. The standard procedure is the same across all banks and NBFCs. Following are the steps involved in home loan procedure.
You have to choose the right lending institution for you. You have to be very careful in this first and foremost step. It is so because how you are going to financially spend your next many years depends on that. The rate of interest varies from bank-to-bank. A lower rate of interest means lower EMI which in turn means less burden on your income. Letting loan installments take a big chunk out of your income every month when it could have been less, is not wise.
So, how to choose the right bank? You already have all the details of all the banks and NBFCs in BankHelpline. You can compare and choose the best suitable option for you. In case you need more help, then keep the following points in mind before choosing the right bank.
Get the loan application and fill it. Fortunately, we are living in a time when you have the option to fill online loan application form. You do not have to wince over the mistakes you might make while filling the form because a simple pressing of delete button will do. No wastage of paper, no worries mishandling the form and no need to physically submit your application because a simple pressing of submit button will do the same.
In case, the bank or the NBFC which you have chosen does not provide online loan application facility, then keep the following points in mind before filling the physical form:
The details which are asked in the application form are:
There are certain documents which are to be provided to the bank to validate those details provided on the application.
|Photo ID and age proof||PAN card, Adhaar card, Driving license, Voter ID card||PAN card, Adhaar card, Driving license, Voter ID card|
|Address proof||Adhaar card, Driving license, Voter ID card||Adhaar card, Driving license, Voter ID card|
|Income proof||Last 3 months’ salary slip, Form 16 or Income tax return||Last 3 years income tax return with the computation of income.|
|Income track record||Last 6 months’ bank statement||Last 6 months’ bank statement|
A cheque of the amount specified by the bank has to be paid as a processing fee. The fee is to process your loan application file. As mentioned earlier, this fee varies from bank-to-bank.
As soon as the application form along with the documents is submitted to the bank, the ball gets into its court. Bank verifies all the documents by:
The loan is approved as soon as the bank is convinced about the following things through documents and verification of the same,
The bank drafts the final offer letter of the loan for the applicant to sign. The offer letter consists of the following things:
The loan applicant has to thoroughly read the offer letter before signing it. If possible he or she can negotiate on certain points with the bank. At this point, the applicant can also reject to sign if he/she does not find the offer suitable for them.
After the applicant signs the offer letter, the bank keeps the original and gives a copy of it to the applicant.
A proper legal check of the property which the applicant is willing to buy is necessary. If the applicant wishes he or she can hire the lawyer as per their wish. Or else, the banks have their lawyers to do the same.
Why legal check is important? Many a time the seller of the property hides certain facts about the property just to get the sale done. The property may already be in a dispute with some other party. Therefore, a legal check is necessary to find out if the property is free from any such dissension.
The final stage of the loan is disbursement. It is when the bank issues the cheque of the loan amount favoring the seller or the builder of the property.