Home Loan

Home Loan is the process of providing money by the Bank or by the Housing Finance Company to another party (who is intended to buy a property) against the property or security of the home. Incase if the party who gets the loan fails to repay the loan obtained from the Bank or Housing Finance Company, the Bank or the Housing Finance Company shall retrieve the lend amount from the party by selling the property.


Rate of interest provided by banks.



Home Loan Process:

All the Banks follow few procedures for providing\sanctioning the Home Loan. Following are the list of steps involved in obtaining the Home Loan
  • Submission of Loan Application Form to the Bank\Housing Finance Company
  • Applicant verification and Evaluation of the Field  Credit Assessment
  • Sanction of Loan
  • Legal Document Verification
  • Loan Agreement Signing
  • Amount Disbursement

Submission of Loan Application Form to the Bank\Housing Finance Company:

Once the buyer of the property has identified the Bank or the Housing Finance Company, the next step is to get the loan application form from the corresponding Bank or Housing Finance Company. Loan application form will have fields to fill all the required information (personal, professional, financial assets, etc.) from the buyer. The loan applicant should fill all the information required by the Bank and submit the loan application to the Bank or the Housing Finance Company. The loan applicant should submit the application form along with the following documents
  • Photograph (Passport size)
  • Identity Proof (PAN/ Voter ID/ Driving License/Passport)
  • Residence Proof (Electricity bill/Telephone bill/Property tax receipt)
  • Income Proof
  • Bank Statements
  • Sale Deed
  • Plan Approval document
Applicant verification and Evaluation of the Field: The Bank or the Housing Finance Company receives the loan application form from the property buyer and verifies the details furnished on the application form. If the Bank satisfies with the details on the applications form and the documents submitted by the applicant, Bank sends their representatives to field to investigate and confirm the information stated in the application form are correct.

Credit Assessment:

Here, the Bank or the Housing Finance Company validates the repayment capacity of the applicant through his age, qualification, income, type of business, experience etc. Bank also verifies the credit history of the buyer through Cibil score. If the Bank finds any discrepancy in the credit assessment stage, rejects the loan application. If the repayment capacity is good and the Cibil score is high, Bank or the Housing Finance Company sanctions the loan.

Sanction of Loan:

After the credit assessment is completed, the Bank or the Housing Finance Company decides on the amount that can be disbursed to the applicant and sanctions the loan. The bank or the Housing Finance Company sends an offer letter to the applicant with the below details:
  • Loan Amount Sanctioned
  • nterest Rate
  • Interest Type (Fixed or Variable)
  • Loan Tenure
  • Repayment Mode
  • Terms and Conditions
  • Special Conditions
(If any) Once the applicant agreed to the terms and conditions from the Bank has to sign the sanction letter and submit the duplicate copy of the sanction letter to the Bank or the Housing Finance Company.

Legal Document Verification:

The loan applicant has to submit all the legal documents of the property involved in availing the loan. The Bank or the Housing Finance Company will authenticate the legal documents, does all the legal checks. After the legal checks, the Bank or the Housing Finance Company does a technical valuation of the property through the team of experts by visiting the site.

Loan Agreement Signing:

The buyer signs the loan agreement and after signing the agreement, few postdated cheques to be submitted to the Bank or the Housing Finance Company.

Amount Disbursement:

Final step of the home loan process, once the Bank or the House Finance Company makes sure that financing property is risk free. The Bank or the House Finance Company disburses the loan amount as full payment (for ready possession) or part payment (for under construction property).

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