There is a famous proverb that “Well begun is half done”. The same goes for Home Loan Process. Most of the potential borrowers stuck on how to initiate Home Loan Process. You can apply for Home Loan with or without finalizing the Property. To kick start Home Loan Process, follow these simple steps
Before starting Home Loan Process, visit the website of a Bank / HFC (Housing Finance Company) for the list of documents required. You may collect list of documents from Branch. For simplicity purpose, i will refer Bank or HFC as “Bank” in the post. If you have already finalized the property then arrange the property documents as per the list of Property Documents required by Bank. In this case, Home Loan Process will be fast.
The objective of Self Assessment is to ensure that all documents are in place and to avoid any future shock during Home Loan Process.
Visit the nearest branch of Bank or you may avail services of bank representative who would assist you to complete the Home Loan process. Easiest way is to place enquiry on bank’s website and they would get in touch with you. Fill the Home Loan Application Submit all the documents along with processing fees.
You can apply for Home Loan in either City A or in City B for Property in City B
Next step in Home Loan Process is Home Loan Assessment. Bank will evaluate your application and fix your Loan Eligibility. Some of the factors considered by bank are
Bank will conduct independent Legal Verification of the property through lawyer. The lawyer will issue Title Certificate or Legal Verification Report to Bank. A borrower may request for the copy of this report by paying nominal fees.
For technical assessment, Bank will appoint Valuer who will fix the Fair Market value of the property. The objective of this exercise is to ensure that appropriate loan amount is approved against the property.
After complete verification, Bank will sanction the Home Loan against Property. A sanction americashpaydayloan.com/payday-loans-wv letter will be issued to Borrower. Now the borrower is ready to sign Home Loan Agreement. Home Loan agreement will contain all the terms and conditions related to Home Loan. Borrower is also supposed to submit original documents, ECS along with cheques and other undertakings as per the requirement of the Bank to complete Home Loan Process.
After the Home Loan Agreement is signed, Borrower may finalize the date of Property Registration in coordination with Seller. Simultaneously borrower may give written request to Bank for Disbursement or Demand Letter. Bank will issue DD/Banker’s Cheque for property registration.
3. If property value is less than 20 Lacs then you may avail maximum loan equivalent to 90% of Property value
4. If property value is more than 20 Lacs than you may avail maximum loan equivalent to 80% of Property value subject to your repayment capacity evaluated by bank
In case the property you have finalized is already approved by Bank, they may not carry the legal and technical verification again
6. A CIBIL Score of 750 does not guarantee assured Home Loan approval. Home Loan is approved based on multiple factors and Perceived Risk Profile of the Potential borrower.
8. Stamp Duty Registration cost is not included in property whereas HFC include the same in Property value. For example, if property value is 50 Lacs and Stamp Duty + Registration Cost is 5 Lacs. Bank will sanction Home Loan equivalent to 80% of 50 lacs whereas HFC will sanction Home Loan equivalent to 80% of 55 Lacs.