How to Get a Home Loan: Documentation and EMI Planning

When it comes to buying a house through Home Loans, there are two crucial aspects to consider: the documentation required and EMIs. In this guide, we’ll explore the must-have papers you’ll need to navigate the home loan process smoothly.Additionally, we’ll uncover the power of a handy tool—the home loan EMI calculator—to help you plan your EMIs effectively. So, let’s dive in and uncover the secrets to successfully navigating home loan documentation, including stamp duty in UP, while taking advantage of the convenience offered by a home loan EMI calculator.

What is a Home Loan?

One can borrow a home loan from banks or financial institutions to fulfill their dream of purchasing, constructing, extending, or renovating their home. The borrower will return the principal in part payments, known as Equal Monthly Installments (EMIs), including the interest on the principal. You can easily calculate the number of EMIs using a home EMI calculator on the bank website.

Types of Home Loans

Banks or financial institutions offer different types of loans according to the borrowers’ needs. Here are some of the different kinds of home loans available:

Home Loans:

It is the most common type of loan, and you can use it to buy a new apartment, flat, or bungalow from a real estate developer. You can also apply for an under-construction project via this type of loan.

Home Construction Loan:

Construction Loan is a loan you can avail of if you have a plot of land and need a budget to construct a house.

House Renovation Loan:

If you want to renovate your house, you can apply for this loan. These funds can be used for flooring, painting, repairs, etc.

Home Extension Loan:

This type of loan aids in extending your homeroom or floor, making a new bathroom or expanding your kitchen, etc.

Plot Loan:

You can avail of this type of loan if you want to purchase a plot with the idea of building a home in the near future.

Balance Transfer Loan:

A balance transfer loan allows the borrower to switch to another bank with the existing loan to get lower interest rates or rewards.

Essential Documents Required

When you apply for a loan, you must fill out forms and produce some crucial documents as different proofs like identification, residential, etc. Here is a list of necessary documents that are necessary for any application for a loan.

• Pan Card Identity Verification Documents

1. Driver’s License
2. Aadhar Card
3. Passport Address Proof
4. An Identity Proof with the Permanent Address
5. Voter’s ID Card

• Property Documents

1. Stamped sale agreement/Sales Deed or letter of Allotment
2. NOC from the builder/housing society
3. Certificate of Possession Estimated Construction Costs

• Documents Required for Salaried and Self-Employed

There are different types of home construction loan documents required as per your occupation. The two divisions are salaried and self-employed. Some of the documents the bank requires from salaried and self-employed are common to both divisions, such as:

• Passport-sized Photograph
• Loan Application Form
• Identification Documentation:

1. Voter ID Card
2. Passport
3. Aadhaar Card
4. Pan Card
5. Driver’s License

• Age Verification:

1. Birth Certificate
2. 10th Class Marksheet
3. Bank Passbook
4. Passport
5. Aadhaar Card

• Resident Proof:

1. Telephone Bill, Electricity Bill, Water Bill, or Gas Bill
2. Bank Passbook
3. Voter’s ID
4. Ration Card
5. Passport
6. LIC Policy Receipt

For Salaried People, the following documents are required:

• Offer letter
• Payslips from the last three months
• Increment letter
• IT returns for the previous three years
• Promotion Letter

For Self-Employed Persons, the following documents are required:

• Registration Certificate For Shops, Factories & Other Establishments
• Company License
• Address Proof of Business Location
• Professional Practice Licence
• Income Tax Returns (ITR) over the last three years
• Balance sheet, Profit & Loss Account Statement attested by a Charted Accountant

Conclusion

In conclusion, when you apply for a home loan, you must have the essential documents to get the loan. The documents asked by the banks are relatively easy to produce; some include address proof, identification proof, and proof of employment. If you are self-employed, you must show your ITR documents, Balance sheet, Profit & Loss Statement, etc. (if you have a company).

Also Read: Your Dream Home Awaits: Instant Sanction Letter In Just 10 Minutes With Kotak Home Loans

Sometimes banks ask you to disclose your assets, such as investments or bank statements. It is vital to gather all of these documents before you apply for a home loan, as they will help the bank determine your eligibility for the loan. By being prepared and organized, you can improve your chances of getting approved for a home loan with favourable terms.