STEP-BY-STEP GUIDE: PROCESS OF HOME LOAN APPLICATION & APPROVAL

Every human being’s cherished dream is to have a home of his/her own. There are a lot of reputed real estate construction companies in Bangalore that can give you a plethora of options for your dream home. However, surpassing the intricacies of the home loan process in India might not be an easy task to make your dream home come true. Thus, we have curated a simplistic guide, decoding the entire cumbersome process of home loan application and approval in India.

Before we jump into the process there are a few steps to be taken as a home loan applicant. It includes researching the criteria of home loan eligibility in India and assessing your credit eligibility. You can also resort to some reliable financial institutions or banks who can help you in figuring it out. It can be a simple CIBL score to other complex parameters/indices as well.

Getting deep into the actual home loan process, India:

Select Your Lender:

Amidst the plethora of home loan providers in India, finding the right lender is the foremost step in the process of home loan application. Never make haste! Take adequate time to research and make a proper analysis. Make sure that you cross-check the home loan interest rates of all banks in India.

Each lender/bank will also differ based on their terms and conditions. A simple home loan EMI calculator can also prove to be handy. You can assess your affordability and even evaluate the various loan offers available. It might also give you a rough understanding of home loan eligibility in India.

Shortlist the one that is likely to be the most favorable and lucrative deal that is tailored to your needs to get started off.

Initiate Loan Application:

The next important step is to initiate the process of home loan application. The majority of lenders offer the convenience of applying for a home loan online. This obviously simplifies the tiring procedure of the home loan process in India. Another option is, you can also visit the lender’s office directly if you are comfortable with the traditional approach.

However, be prepared to provide every necessary document. The documents vital for the home loan process, in India, include:

• KYC (Know Your Customer)
• Age proof
• Address proof
• Educational certificates
• Income verification
• Property-related documents, etc.

Keep all these documents stacked up for a smooth and hassle-free process of a home loan application.

Pay Processing Fees:

The next important step in the process of a home loan application is paying the processing fee. The fee includes maintenance expenses of your loan account. This also includes sending the required statements plus agency commission. This fee ranges from 0.25% to 0.50% of the entire loan amount. Negotiating with your lender to reduce or waive this fee is an option.

Pro tip: Applying during festive seasons can waive your processing fee!

Await For The Response:

After submitting your application with accurate documentation, you can expect to receive a response within a timeframe of 24 to 72 hours. Most lenders try to make a decision within 48 hours max, to speed up the process of home loan disbursement.

Document Verification:

The next crucial step in the home loan process, in India is the verification of the documents submitted. Lenders verify each and every document when approving home loans due to the increasing financial commitment involved. They scrutinize applications carefully to assess eligibility and accuracy. It is true that lenders will not proceed with loan sanction and disbursement until every document is properly verified. Keep in mind that it is vital to provide truthful information to avoid any complications in the process of home loan application.

Loan Sanction/Offer Letter:

Upon satisfaction with your application, the respective lender will extend a formal loan offer. This offer will specify key details that include:

• loan amount
• interest rate
• loan tenure
• other terms & conditions

Take time to review this agreement carefully and only if you are content with the terms, sign and send the signed copy back to the lender. However, in case of any queries/clarifications feel free to discuss and negotiate with your lender.

Property Document Verification:

This is yet another crucial step by the lender in the process of home loan disbursement. After receiving your signed agreement, the lender will proceed to verify your property documents. All original property documents will be held by the lender throughout the loan tenure. They will also conduct a formal technical inspection of the property. This is to avoid legal or technical issues in the future. It is always advisable to extend full cooperation and support in each step to have a hassle-free disbursement.

Signing the Loan Agreement:

The final step in the home loan process, India is that you need to personally visit your lender’s office to sign the loan agreement. The catch here is that this particular step cannot be completed online.

Prior to signing, carefully review the entire agreement. Never hesitate to seek clarification if needed. Always resort it experts like a home loan legal expert, if any aspect remains unclear. Once you are completely satisfied with every aspect of the agreement (with all the terms and conditions), proceed to sign the agreement.

Upon signing the final loan agreement, your lender will sanction and disburse the loan amount. Now you are legally authorized to proceed with your home purchase. Go ahead, pay the builder, and make your dream home come true

Conclusion:

It is the applicant’s primary responsibility to take full care of each and every step in the process of home loan application. Stay abreast of the changing rules and regulations, home loan interest rates in India from all banks, market trends, etc. Not to miss, be clear about your objective, financial soundness, family commitments, timeline, market rates, etc. before taking any such big step. Nowadays many top real estate builders in Bangalore can also render valuable advice regarding the home loan process, proceedings, authentic lenders, etc.

All the best!

Disclaimer:

The above content is for informational purposes only, and we disclaim any warranties, expressed or implied, regarding its accuracy or endorsement of any content. Always consult with a financial advisor before making financial decisions.