By With so many banks and financial institutions offering online services, it is possible to get a home loan from your home with the click of a button.
In this article, we share a hassle-free step-by-step guide to applying for a home loan online, including the documents required, the charges involved, and more.
Steps to Follow While Applying for a Home Loan
Here are the steps you should follow.
Application Form and Supporting Documents
You will need to provide the following information in the home loan application form:
- Personal details like name and contact number
- Residential address
- Annual income
- Educational Qualification
- Job profile
- Property details
- The market price of the property
- Other sources for financing the property
The following supporting documents are also required along with the application form:
- Aadhar card or passport for identity and address proof
- Form 16 or 16A for income proof
- Appointment letter for employment details
- Certificates/Diplomas for educational qualification proof
- Latest IT returns
- Bank statements for the last three months
- Details of the property being purchased
Processing Fee
All banks and financial institutions charge a processing fee for cover charges like providing certificates for Income Tax purposes and more.
The fee ranges from 0.25 to 0.5% of the loan amount.
Verification of Documents
The supporting documents provided by you, along with the loan application, will be verified by the bank. The bank will check the following:
- Address Proof
- Employer Credentials
- Work/residence contact number
- Current residential address
Loan Sanction
The bank examines the following documents before approving the home loan:
- Age-proof and educational background
- Bank statement to verify monthly income
- Employment details like appointment/offer letter and type of job
- Type of business for self-employed applicants
- Source of funds to determine loan repayment capacity
After examining all these documents, the bank will decide the maximum loan amount it can sanction. A sanction letter is issued, though in some cases, banks may ask for additional information.
Issue of Offer Letter
The certified offer letter is sent to the applicant after the sanction letter, and it includes the following:
- The total amount of loan being sanctioned
- Interest Rate being charged
- Type of loan – Fixed or Floating Rate
- Tenure of the loan
- Loan repayment schedule
- Terms and conditions relating to the loan, including any special clauses
Once you get the offer letter, you need to sign the duplicate copy and return it to the bank to signify acceptance of everything mentioned in the offer letter.
Legal Check
After the offer letter, the next step is a legal check of the property papers. It includes:
- Seller details, including name, identity, and address proof
- Property details, including name and address
- All communication between the buyer and the seller regarding the property
- No Objection Certificate or NOC from the seller
- In the case of a cooperative society, a NOC from the society
- NOC from the lessor in case of the leased property
Once the bank’s legal department approves the documents, the next step is a technical check of the property.
Technical inspection of the Property
The site property is inspected to verify the following:
- Stage of completion of the project
- Construction quality
- Adherence to building regulations
- Certifications for builders
- Property valuation
After the technical inspection, the bank representative will check for the following:
- Age of the building
- Maintenance
- Existing mortgage on the property
- Valuation
- Approval plans
Signing the Agreement and Loan Disbursal
Once the bank’s verification process is complete, you need to sign the agreement and provide the post-dated cheques. It is the Memorandum of Execution or MOE stage.
The stamp duty applicable to the agreement is payable by you.
The bank pays a certain portion of the loan amount, and the balance has to be paid by you. The bank either issues a cheque or credits the amount to your account.
Conclusion
Applying for a home loan is hassle-free if you are eligible for a bank loan and have the required documents. If you are looking for a home loan with the lowest interest rate, try PNB Housing Finance Ltd. Ensure you have all the required documents when applying online for a home loan.
Log on to our portal and make your dream home a reality!
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