Excitement and fear go hand in hand as one navigates through the proceedings necessary for applying for a home loan and, thus, buying a dream home. Let us go into the details of the major documents that you will need for a house loan to make the journey smooth and hassle-free.
1. Documents of identification:
Your lender needs to know who you are. Making sure you use valid identification will help you avoid unnecessary delays in the processing of your application. Documents to let them know this normally include:
- Passport Voter Identification
- Driver’s License SC/ST Certificate – Aadhaar Card
Any one of these again is necessary upon submission because it is what the bank uses to verify your details.
2. Proof of address:
Your present residential address should be validated. Lenders require proof of address simply because it makes the borrower traceable for the entire period of the loan. You can submit:
Utility bills for example electricity, water, or gas
- Rent agreement Bank statements that reflect your address
Having these documents in order can save you so much time when applying for a home loan. Make sure the address listed on these documents matches your application.
3. Proof of income:
The income is very important because it’s the determinant of your payback ability. Lenders use this to measure your financial stability. Documents required for salaried people are as follows:
- Recent pay stubs must be at least 3 months. Form 16 or Returns of Income Tax for the last 2 years.
For the self-employed, the requirements are a little different as they need to elaborate on:
- ITR of the last 3 years
- Profit & Loss statement or balance sheets
These documents help lenders assess your capability of repaying the housing loans applied for.
4. Bank statements:
In addition to proof of income, lenders will also require bank statements as a surety check on one’s financial history. This will give the lender some insight into your spending habits and any existing debts. The BANK statements that lenders usually request include:
- Bank statement for the last 6 months
By checking these, the bank would ensure that your finances were strong enough to bear the monthly installments of the home loan.
5. Property documentation:
Documents proving the validity of properties in case of a bank purchasing a house: The following are such documents.
Sales agreement:
- Title deed Building plan endorsed by the relevant authority
If the property is under construction, then additional documents are required such as the builder’s NOC. The submission of property documents accurately is very crucial for getting a home loan without any legal hassles.
6. Verification of age:
Differently, many a time, lenders need age proof to decide on the loan term. A younger applicant will get more time than his older counterpart to return the amount. The acceptable documents are:
- Birth certificate
- PAN card
- Passport
The below documentation helps the bank decide on the tenure and loan amount about your home loan.
7. Employment details:
In the case of a salaried employee, it proves the stability of the current job details. These documents ensure that the bank considers your future ability to repay the amount continuously.
- Certificate of employment
- Appointment letter from the current employer
Conclusion
Application for a home loan might sound like a heap of papers, but once you understand and get your papers in order, it’s quite smooth. Keep each updated and check with the lender if anything more is needed for your type of loan. Be prepared, and the dream of owning a house will no longer be a dream.