Home loans are credits availed by borrowers to purchase a residential or commercial property against a mortgaged asset. The credit amount depends on the Loan to Value (LTV) provided by lenders, the credit history of the borrower, etc.
Considering the hefty expenses involved in buying a property, home loans in India are becoming one of the most popular forms of advances offered by nearly all pan-Indian financial intuitions. However, this high-end expenditure makes lenders cautious about the credibility and repayment capability of the borrowers.
It is vital for borrowers to have a comprehensive idea about housing loan and how to make the best of them.
Home Loans in India
Despite Government schemes to boost the affordable housing industry, the real estate market still faces challenges due to a simultaneous rise in demand for houses, and its rising prices. The demand has also reflected in case of home loans, prompting leading financial institutions to offer borrower-friendly terms and attract more customers.
However, the offered features and benefits vary from one NBFC to the other. So, remember to do thorough research on the following pointers before settling for a loan.
A. Eligibility Criteria and Documents
Home loans are available for both salaried and self-employed individuals. Eligibility criteria and documentation basics vary accordingly. Viz. –
- Indian citizenship and residence
- Between 23 and 62 years (salaried); 25 and 70 years (self-employed)
- Work experience of a minimum of 3 years (salaried), or 5 years (self-employed) in their specific field of work
- KYC documents
- ID proof
- Bank account statements of the last 6 months
- Form 16 or their latest salary slip (salaried)
- Documentation of proof for the 5+ years of experience in business (self-employed)
- Address proof
NBFCs such as Bajaj Finserv provide such easy-to-meet eligibility criteria and minimal documentation requirements to aid in quick approval and disbursal of the credit amount.
B. Tips before Applying for a Home Loan
Here are a few tips for you to consider before you approach a financial institution for home loans –
- Check your credit score: A higher credit score (750+) reflects the borrower’s repayment capability. Such scores make lenders more willing to provide the requested credit amount along with other borrower-friendly terms & conditions.
- Survey the market for the best home loan offers: Home loans by reputed NBFCs like Bajaj Finserv come with attractive features and offers. The beneficial features may include easy balance transfer facility, high-value top-up, flexible tenors ranging up to 240 months, property dossier services, zero charges on foreclosure or part-prepayment, attractive interest rates, etc.
- Check out the housing loan interest rates: It is obvious that borrowers will refer to lenders offering the lowest interest rates on their loans. Choosing whether to opt for fixed or floating interest rates is a vital decision to make as well. It is important also to keep an eye on the total amount of interest paid at the end of the tenor. Tools like the loan EMI calculator can help a borrower calculate all of this and more.
C. Home Loan Online Apply
Step 1: Enter a few personal, employment, and financial details on the online application form.
Step 2: Furnish information on the property.
Step 3: Pay an online secure fee to book the home loan offers available.
Step 4: Upload scanned copies of documents.
Look out for NBFCs providing such a hassle-free application process for home loans in India and only settle for one after a thorough survey of the market. Such informed decisions will help you handle your loan as per your budget.
Watch to know the things to remember before taking a Home Loan: