Plenty of things in life make us feel accomplished and complete, but very few of them come close to the feeling of buying a house with hard-earned money.
Some people opt for Home Loans when looking for financial alternatives to buy a home. However, there can be times when they don’t know how to apply for it. Although many guides are available online to assist you with the Home Loan procedure, they need to be more thorough to be useful.
Consider this article your comprehensive guide to the entire Home loan process – from application to approval.
Home Loan: Concept, Basic Types, and More
A Home Loan can be hugely beneficial – besides getting great financial support for house construction or purchase. You can also get tax exemption on a Home Loan.
Home Loans come in a variety of forms depending on their use. Some of them are as follows:
Home Purchase Loans
Hands down, the most common forms of Housing Loans in India are those used for home purchases. Here, a person uses the money from the loan that has already been disbursed to buy a house or an apartment that has just been built.
Nearly every single bank and financial organisation in the nation provide this kind of loan.
Land Purchase Loans
This loan is used for buying land where a person intends to build their home. The lender typically covers 85% to 90% of the purchase cost, and the borrower covers the remaining 10% to 15%.
Almost all major financial institutions provide Land Purchase Loans under different names.
Home Construction Loans
People who want to construct a home on their land can apply for this loan. New Home Construction Loans generally come with a quick turnaround time feature. When you have the plan for your new home ready, you won’t have to wait long to arrange funds. Once your application is submitted, you will receive the funds in a few days.
Home Improvement Loans
People who are unable to raise enough money to renovate their homes go for Home Improvement Loans.
A person’s eligibility for this loan is determined by their debt-to-income ratio and financial situation.
Understanding the Home Loan Approval Process: A Step-by-Step Guide
Nowadays, people majorly opt for Home Loan to fulfil their dream of purchasing a new home.
To get the loan hassle-free, you must understand the Home Loan approval process. Follow this step-by-step guide to experience a smooth loan approval process.
Step 1: Find the Ideal Lender
Once you’ve chosen the kind of loan you will be opting for and met its eligibility requirements, it’s time to shop for lenders. Not all Home Loans are the same. Every lender offers loan deals with different interest rates, tenure etc.
Therefore, conducting extensive research and finding the ideal lender for loan requirements is crucial.
Step 2: Fill out the Loan Application Form
Take your time when you are filling out the loan application. Fill in the details accurately to make the loan approval process quick and hassle-free. Furthermore, the processing fee must be paid with the application.
If all the documents you’ve submitted with the application are successfully verified, the lender may approve your loan within a few days.
Step 3: Verification and Approval
Documents proving your identity, address, employment, income, and other sources of income (if any) are required in the approval process. Other elements like your credit rating, employment history, total debt, age, required loan amount, etc., also play a role in your loan application’s approval.
The lender will conduct a background investigation to ensure that all the information you provide is accurate. You can be sure that your loan application will be approved quickly if all of these conditions are met.
Conclusion
The Home Loan process can be smooth and easy if you follow the tips mentioned above. Use the information in this article to fulfil your desire to own your dream home.