Checklist before applying for a Home Loan

By - IndianMoney.com Research Team     21 July 2014

home loan cheecklist
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  • Check your eligibility criteria and the interest rate charged on the home loan

  • Maintain a good credit score with CIBIL in order to get the home loan sanctioned as well as a lower interest rate

  • There is no prepayment penalty on the floating rate home loan

  • Banks do not levy foreclosure charges on floating rate loans

  • Banks charge around 0.5% -1% of the total home loan amount applied for as a processing fee. This is a non refundable amount and is not returned in case the home loan is not sanctioned.

  • The bank charges a prepayment penalty which is basically 1-2% of the outstanding loan amount if the fixed interest rate home loan is prepaid

  • If your bank has reduced rates for new borrowers, and you an existing borrower with a high credit score are charged a higher rate you can approach the bank using the balance transfer as a bargaining chip in order to secure a lower rate from the bank.

  • Banks conduct a legal check on your documents namely the title deed, the sale deed as well as the encumbrance certificate to validate their authenticity and make sure the home/land does not have any pending dues associated with it.

  • Have your home/apartment constructed by a reputed builder/developer as they are well versed with the banks legal and due diligence processes which makes a home loan easier to avail.

Under : Loans and Credit Cards