Securing a housing loan can initially appear daunting, given the numerous application forms and documents needed. It requires careful planning to ensure the loan aligns with your budget, and you get the property that suits your needs best.
Here’s a user-friendly guide on understanding housing loans, aimed toward making your journey less overwhelming.
Documents Needed
Before proceeding with your housing loan, certain necessary documents should be prepared:
A completed application form,
A clear copy of one or two government-recognized IDs,
Marriage certificate for married applicants,
For expatriates or foreigners, a copy of the Alien Certificate of Registration (ACR) indicating their VISA status as permanent residents or holders of an Alien Employment Permit (AEP). A VISA ID is also acceptable,
Latest Income Tax Return (ITR),
Latest employment certificate or payslips for the past three months,
For self-employed applicants, business registration papers, latest audited financial statements for the past two years and latest three months bank statements.
Procedure
Securing a housing loan involves several stages:
1. Application: This commences when you complete the loan application form, state your terms and conditions, and submit the required documents. The timeline for receiving results may vary depending on the financing institute.
2. Processing: This stage involves assessing your eligibility. Via a called ‘prequalification’, a representative from the lending institution will confirm your financial capability by asking about your income, liabilities, and assets. They may also evaluate your co-signer’s ability to repay the loan, should you fail.
3. Preapproval: This requires submitting specific documents like bank statements and recent income tax returns to demonstrate your ability to make consistent monthly repayments.
4. Loan Approval: If you successfully pass all processing stages, the bank will notify you about your loan approval. Borrowers are then required to sign a loan agreement and pay the Processing Fee for REM.
5. Fund Disbursement: After securing approval from the bank, the loan amount is disbursed to you.
Tips
Here are some useful tips to remember while applying for a housing loan:
Always be truthful in your forms,
Consider all associated costs,
Track your credit score regularly.
Best of luck with your application!
