Owning a home is one of the most important steps in a person’s life, and it may be rather overwhelming to start with what is called a mortgage. However, one of them is understanding the necessary documents required for home loan. While the demands may not be similar among different lenders but flexible among different lenders, with this article, you will have a checklist to ensure a smooth loan application process.
Essential KYC Documents Needed
KYC documents should always be the basis of your application. These verify your identity and residence.
Proof of Identity: Aadhaar Card/Passport/Voter ID Card/Driving License Any One Latest.
Proof of Address: Aadhaar Card, Passport, Voter ID, bills (electricity, water, etc.), Ration Card (Any one)
How Does a Lender Assess Your Liability?
All the lenders will assess your ability to repay the loan. You need different proofs to demonstrate your financial capabilities.
Income Proof:
Salaried Individuals: Latest salary slip for the last 3 to 6 months, Income Tax Certification for the last financial year.
Self-employed Individuals: Show bank statements for six months, income tax returns for the last two to three years, and audited financial statements of business people.
Previous Loan Repayment Records The loan account statement for the last year is the sanction letter of the previous loan taken from the bank.
Proof of Assets: Documents for existing investments such as FDs, mutual funds, or if the borrower is planning to put a loan against property.
Proof of Ownership and Property Details
The lender needs to know everything about the property you’re financing:
Sale Deed or Agreement for Sale: This creates the legal ownership rights on the property.
Building Plans and Occupancy Certificate: These hold the actual proof that the property was built legally and sanctioned for occupation.
No Objection Certificate (NOC) from the Society/Apartment Association: This affirms that there are no other costs or charges that may be incurred on the premises.
Property Tax Receipts: Proof of the payment of property taxes due at the time of the inspection or beforehand.
Additional Documents
Recent passport-sized Photographs
Loan Application Form: This form has to be filled out completely and duly signed.
Notes To Remember
- Make sure that you scan your documents and make the copies clear and readable.
- Original documents might be asked for for loan verification, so make sure that the documents are not counterfeit.
- There are some standard procedures that may be accompanied by additional requirements according to the type of loan provided by the lender.
Documents Needed for a Loan Against Property
If you already own a property in real estate, a loan against property is a smart strategy to fund your home acquisition. The documents required for a LAP are the same as for a home loan, with an additional focus on the collateral property.
If you gather these documents in advance, it will not only help you speed up the home loan application but also the LAP application process. This relieves you of the tasks of determining how close the rates are or haggling on percentage points to arrive at the best deal possible. This can give you the opportunity to look at the loan offers, lower the interest rates, and bargain for the best offers.
Conclusion
Applying for a home loan sometimes requires the right document in order to close the deal. It is important for both those opting for the regular house-building loan and those who are considering the options of a loan against property. Make sure that you have all the paperwork that you need to make the way for a successful application process to be followed. In LAP, the documents required for a home loan are the same as for any other loan.