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 turn 65 years of age.
To be eligible for a commercial 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 turn 65 years of age. The loan can be for the purchase/construction/extension of a non-residential property. A loan for renovation will only be given at the time when the property has been acquired. Professionally qualified and self-employed individuals can apply but a minimum of 3 year's work experience is a necessary.
The loan amount depends on a number of factors such as age, income, number of dependents, qualifications, assets and liabilities, income stability, business profits, etc. However, there are ways in which to increase loan eligibility and amount. If a spouse or fiancee is earning, applying together as co-applicants can increase 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 to 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 Home Loans
Documents required for self-employed persons:
- Updated pass book or Xerox copy of the applicants statement of accounts for the past 6 months
- A Xerox copy of the applicants ration card
- A profile of the applicants 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 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 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 applicants Employer
- A Xerox copy of the applicants updated bank pass book or a statement of the applicants accounts for last 6 months
- A Xerox copy of the applicants voter I.D. card or the applicants Company's I.D. or the applicants passport/ ration card
- A passport size photograph of the applicant & co-applicant
- The original certificate from the applicants employer for any other allowances that are not reflected in the applicants salary slip
The loan will be sanctioned after the selection of 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