A Step-by-step Guide to Home Loan Application

 

Here’s the step-by-step process of home loan application

Step 1: Filling the home loan application form 

The process of home loan starts with filling out the application form. Here are the basic details you are likely to have to provide: 

• Name and address
• Contact details
• Education details
• Type of employment
• Income

Step 2: Documentation 

Once you fill in your basic details, you will have to attach the following documents for verification: 

• Identity proof 
• Address proof 
• Payslips of the last three months
• Proof of employment
• Bank statements covering the last six months
• Form 16 

 

Note: If you’re a self-employed individual, you’ll have to provide the ITR of the last two years and other income-specific documents. 

Step 3: Processing and Verification 

On submission of the application form along with the documents, the lender starts processing your home loan application. The bank is going to verify the documents you provide. The next step is examining your creditworthiness. The lender will conduct an extensive enquiry.  If your documents are in place and you have a high credit score, the lender will proceed with the home loan application. 

Step 4: Sanction Letter 

On successful approval of the application, the lender sends a sanction letter, which is a proof that the lender has approved the home loan. Essential details like the following are enclosed in this: 

• The home loan amount you’re eligible for.
• The interest rate 
• Type of housing loan interest
• Tenor
• Terms and conditions

After reviewing the sanction letter, you have to sign the letter and send it back to the lender. 

Step 5: Payment Fee

On signing the home loan sanction letter, you’ll need to pay a one-time secure payment fee. 

Step 6: Legal and Technical Check 

Before the lender disburses the loan amount, it conducts legal as well as technical checks. The lender’s representatives will examine the property, the ownership rights of the property, the documents submitted, and so on. 

Step 7: Loan Disbursal 

Once the lender is satisfied with the checks, your home loan will be approved. You will receive a final agreement letter. Post disbursal, you will also get a welcome kit and a detailed home loan EMI schedule.  

 

Final Thoughts

It is essential to check the home loan eligibility criteria before you initiate the process of home loan. You can choose to seek professional guidance to make an informed decision. 

Read Also: What is the Procedure to opt for a Home Loan?