To be eligible for a home loan, the applicant must be at least 21 years of age with a regular source of income from employment or self-employment. The loan must terminate before or when the applicant turns 65 years of age. The applicant should also possess at least 6 months of income proof.
Loan Amount
The loan amount depends on several factors such as age, income, number of dependents, qualifications, assets and liabilities, income stability, business profits, etc.
However, there are ways to increase loan eligibility and amount. If a spouse or fiancée is earning, applying together as co-applicants can increase the chances of a larger loan amount. In such cases, proof of marriage must be submitted. On the contrary, if there are any co-owners, they must necessarily be co-applicants. Providing additional security like bonds, fixed deposits, and LIC policies may also help enhance eligibility. However, the most important factor in sanctioning loans is repayment ability. The total cost includes registration charges, transfer charges, and stamp duties.
Documents required for self-employed persons
- Updated passbook or Xerox copy of the applicant's statement of accounts for the past 6 months
- A Xerox copy of the applicant's ration card
- A profile of the applicant's business mentioning at least the nature of the business, client list, suppliers, employee strength, geographical spread, etc.
- In the case of a business partnership, a copy of the partnership deed, 3 years P & L a/c, B/S, computation of income certified by a CA, and individual computation of income and tax returns for the last 3 years is required.
- In the case of a proprietor or professional, 3 years P & L a/c, B/S, computation of income certified by a CA, and an income tax return file statement for 3 years is required.
- If the company applying for a loan is a Pvt. Ltd., a remuneration certificate, the board resolution for fixing remuneration, the company's annual report, and individual IT returns for the last 3 years is required.
Documents required for employed persons:
- Latest salary certificate or the original slip.
- A Xerox copy of Form no.16 A (TDS Form) from the applicant's Employer.
- The original certificate from the applicant's employer for any other allowances that are not reflected in the applicant's salary slip.
- A Xerox copy of the applicant's updated bank passbook or a statement of the applicant's accounts for the last 6 months.
- A Xerox copy of the applicant's voter ID card or the applicant's Company's ID or the applicant's passport/ration card.
- A passport-size photograph of the applicant & co-applicant.
Disbursement
The loan will be sanctioned after the selection of the property and submission of the required legal documents. The process might take some time as each document needs to be verified for the safety of the applicant. The 230 A Clearance of the seller and/or 37I clearance from the appropriate income tax authorities (if applicable) is also needed. Once the above has been submitted and verified, the registration of the conveyance deed and investment of the applicant's own contribution and the loan amount will be disbursed by the bank. The disbursement will be in favor of the builder.
Documents required for disbursement
- Loan agreements
- Disbursement requests
- Post-dated cheques
- Personal guarantors' documents
