Personal Loans

Now days, most of people buys home by taking a home loan. This requirement is fulfilled by the large number of housing finance companies including nationalize banks and private sector banks in the country. The main thing is that all have their own set of procedures and prior requirements for the home loan.

Taking a home loan is lengthy process which involves many steps. Understanding the process makes you more familiar during the entire home loan process.

Application Form-

Submission of application form is the first step. The application form requires some necessary documents such as personal, residential, income, employment, property details, estimated cost, etc. The requirements may vary from bank to bank. Generally the banks need the following documents.

• Age proof

• Identity proof

• Address proof

• Proof of educational qualification

• Income roof

• Employment details

• Bank statement

Processing Fees-

The bank charge the processing fees with every application. This fees varies from bank to bank, but is usually 0.25% to 1% of the total loan amount. This fees is collected to start and maintain the entire home loan process.

Evaluation and Verification-

The bank evaluates the application form and invites for personal meeting with the bank officials. After satisfied by application and interaction, the bank proceeds to verify the all facts that you have mentioned in application form. The representatives are sent to work place or residence to verify the details of borrower.

Repayment Capacity-

After the field investigation over, the bank moves to verify the repayment capacity of the borrower. This is very vital part of home loan process.

Offer Letter-

After the field investigation, the bank sends offer letter to the borrower. It contains home loan amount, rate of interest, whether fixed or variable rate of interest, loan tenure, mode of repayment, the details of scheme (if the loan is under scheme), terms and conditions.

Submission of Legal Documents-

Prior to disbursement of the loan amount, the customer needs to submit the set of original property documents to the banks. The banks also conduct a site visit to ensure that all the construction norms are have been legally cleared.

Loan Disbursement-

After the home loan agreement is signed, the loan disbursement process begins. There may be slight variations in the process from bank to bank.

Habibulla Antule is a financial advisor and consultant and have provided his expertise to many financial institutions for loans and insurance

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