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Documents Required For Home Loans

IndianMoney.com Research Team | Posted On Friday, October 26,2018, 04:47 PM

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Documents Required For Home Loans

 

 

A home loan or a housing loan is simply the amount borrowed by individuals from a financial institution or bank, for purchasing residential property, or to construct or repair a house.  Lenders provide the loan for a fixed time period and charge interest on the amount borrowed, that has to be paid back along with the principal. These are secured advances and the property that is being purchased, functions as collateral against the loan. The amounts sanctioned towards home loans are usually huge and the tenure is long, while the repayment of home loans is done in equal monthly installments.

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Documents Required For Home Loans

Home Loan Eligibility Criteria:

Home loans are secured loans and therefore the eligibility criteria of these loans differ across banks. However, there are some basic eligibility criteria that are required to get a home loan.

  • A good credit score is required. A CIBIL score of 700 and above is considered to be good. Besides this, a stable source of income and a good financial background is required to determine the loan amount and interest rate.
  • The applicant needs to have a stable source of income to avail a home loan. Banks sanction up to 60 times net monthly income as a home loan.
  • At least one year of stay at the current residence is required to display stability with respect to finance and employment.
  • Banks take into account the current financial standing of the applicant. If the applicant is already availing other loans like car loan or personal loans, then the amount of loan to be sanctioned is calculated, according to the repayments being currently made.
  • The applicant should attain the minimum age of 21 years before applying for a home loan. The borrower must repay his loan by the age of 60-65 years.

SEE ALSO: Important Facts On Home Loans

The following are a few factors on which the sanctioned loan amount depends:

  • Type of borrower: the applicant needs to mention whether he is a salaried or a self employed individual. Depending on the kind of profession one pursues, the interest rate and the amount to be sanctioned will be decided by the bank.
  • Age of the applicant: The applicant should attain the minimum age of 21 years before applying for a home loan.
  • Income of applicant: This is an important component based on which the rates of interest and the amount to be sanctioned depend. An applicant must have a stable source of income and minimum 3 years of service.

Agreement value of the property to be purchased: a sale deed is executed equivalent to the total sale agreement and construction agreement value. It serves as a proof of purchase.

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