How To Get A Home Loan – A Step By Step Guide For First Time Property Buyers
Buying a home can be a once in a lifetime event for most people and often times it is one of the biggest financial decisions. You might be looking to buy a flat, a house or maybe land for construction but the question that does arise is “how to secure such an investment”. There are two options, either you finance it your self, that is make a cash purchase or you can seek financial aid in the form of a Home loan from a bank or a financial institution. Here is a step by step guide as to how to get a home loan for your dream house.
Home loans are a form of loan that is provided for the purchase of a new home or land or for the construction of a new home.
Some of the prominent home loan providers in india are :-
1.Sbi home loan
2.Icici home loan
3.Hdfc home loan
4.Lic housing finance
5.Indiabulls home loan
6.Bajaj Finserv Home Loan
Here are the detailed steps that you need to get a home loan to buy your dream home.
1.Choosing The Perfect Home – once you have a budget and location for your new home in mind, you may use zamindari.in – india’s most transparent property portal to search for flats or houses that are match your requirements and contact seller, agent or developer directly. You can also apply for a home loan directly from zamindari.in or read more to learn how to get a home loan.
2.Documentation – Once a property is finalized, you have your personal and the property documentation for the loan application. The basic documents required are as follows
- Personal Documents
- Aadhar Card
- PAN Card
- Bank Statements – 1 Yr
- Incom Tax Returns– 2-3 yrs
- Current address proof
- Education/professional qualifications (sometimes required)
- Property Documents
- Booking agreement
- Property Sanction Letter
3.Loan Application – This is perhaps one of the most crucial steps in the process, you would need to make a formal application in writing to the bank or financial institution as per the guidelines provided by them. It is necessary that all pre-requisite info is provide in the suggested manner. Here are some of the things you need to keep in mind before you make an application.
4.Choosing the bank or financial institution –
- Eligibility – before making and application, always ensure that you are eligible to receive a loan. Often times there are one or more factors such as pre-existing loans, low repayment capacity or a low cibil score which may lead to rejection of a loan application. Make sure you are eligible by checking your eligibility here and your cibil score here.
- Margin money or down payment – home loans can only cover 70%-80% of your new home’s cost and this is fixed in accordance to the property’s market value thus it you must have sufficient funds at hand to cover the expenses that your loan cannot.
- ROI – Rote of interest can hugely vary from one bank to another when it comes to home loans, find out how much interest you will be charged over the tenure (no. of years of the loan) of the loan and compare with other banks and institutions.
- Processing Fee – This is a non-refundable sum of money that is often charged by the banks in lieu of processing the loan application. The amount may vary from one bank to another but often this is close to 1-2% of the loan amount. Enquire with your bank about this amount before making an application.
- Offers & Schemes – There are various home loan offers from both the government as well as various banks that try to provide attractive discounts and other perks. Always check with multiple banks before making an application
5. Scrutiny & Approval – after all relevant documents which include property papers, your personal and financial documents are duly signed and submitted along with a formal application for a home loan, the bank’s home loan underwriting team will scrutinize and verify all given info. They may also interview the applicant as well as visit the allotted property to ensure that everything is in order. In most cases this may take upto a month. Once the loan is approved the bank will provide you with a sanction letter.
6. Sanction letter – This is a letter of approval or sanction of your loan application, this document will contain the loan amount, tenure of the loan, ROI and other various terms and conditions for your loan. Read this sanction letter very carefully as it may contain various clauses that you may not agree with, ask the bank to clarify every term and condition in person to you so that you perfectly understand everything and agree to it.
7. Disbursement – This refers to the payment of the loan amount to the applicant, this is usually done in installments. In case of a new construction the installments are linked to the construction phases, this is determined by the lender and is not according to the developer’s agreement. In case of a ready to move property, they payment is made in full
Hopefully with this info at hand, getting a home loan should be a breeze. If you need any other info regarding how to get a home loan feel free to let us know because at Zamindari.in we strife to provide the best home buying experience to our users, we can help you get a home loan in the shortest time. Just contact us at +91 6290 39 3300 or visit our home loan application help page here.