5 best methods of home loan, ID proof & minimum interest
As the name suggests, loans taken for home. This is the amount that a person borrows from an NBFC like Fullerton Grihashakti or a bank or financial institution to buy his house. Later, he repays the loan to that institution in the form of EMI every month on a fixed date as per a fixed interest rate. Both principal and interest are available in EMI.
Home Loan Process in India
Before the digitization of banking, the process was complicated and very time consuming for applicants. The online home loan process is not only easy but also trivial. In this, your loan can be transferred in under 8 days. To know the complete process of taking home loan.
This is the process of taking home loan-
- Fill Home Loan Application Form
- Negotiate with the loan institution
- Document Process and Verification
- Home Loan Approval Letter
- Submit Home Loan Documents
- Pay Home Loan Processing Fees
- Property Verification and Legal Investigation
- home loan transfer
Property Verification and Legal Investigation-
- Approved Loan Amount
- mode of payment
- Special Scheme (if applicable)
- Terms and conditions of your home loan
- Your Home Loan Policy
- Avail Home Loan Tax Benefits
- applicable interest rate
- Type of interest rate – floating or fixed
- loan period
The letter may also include other information such as policies related to your home loan.
After receiving the letter, sign and submit the approval copy to the loan institution, provided the contents of the letter are correct. The approval copy is considered a duplicate of the approval letter. Which is used by the loan institution to keep records. At this stage, administrative fees are also paid to the loan institution.
Nowadays everyone has a dream to have their own house. Because of this, many times people take loan from banks to buy a house. Financial advisors say that the cost-effectiveness of different homes also varies because you get a home loan as per your need and are not able to save well.
Following are the main 5 types of home loans-
- Home Purchase Loan.
- Home Improvement Loan.
- Home Construction Loan.
- Land Purchase Loan.
- bridge home loan
1. Home Purchase Loan- In this, home loan is taken for construction of house. If you want to build your own house then you can take a home purchase loan. This includes the price of the plot as well as the cost of building the house. The cost of the plot is covered only if the loan is taken within one year of its purchase.
2. Home Improvement Loan- Loan taken to buy a house. The loan taken to buy a new flat or house is called home purchase loan. If you are buying a new property, you can get up to 90 percent loan from the bank. Banks easily give loans up to 81 percent. The loan tenure can range from 21 to 35 years.
3. Home Construction Loan- Loan which is taken to enlarge the house. Home Loan- If a person wants to increase the size of his existing house, then he can take a loan from the bank for this. This loan is called home extension loan.
4. Land Purchase Loan- Home loan is given for repairing the house. If a person wants to repair, paint or renovate his existing house, he can take a loan from the bank for this. Banks provide home improvement loans for this.
5. Bridge Home Loan- This home loan is given for the period till the owner sells the existing property after purchasing a new property. This home loan helps bridge the funding gap arising from the time taken to sell an existing property. Bridge loans are usually for short periods of time. Banks give this loan for a maximum period of two years.
Take home loan easily with better CIBIL score
You get the loan at the initial interest rate of Home Loan (SBI Home Loan) only when your CIBIL score i.e. credit score is excellent. CIBIL score is calculated between 305 to 910 points. According to experts, if your CIBIL score is at least above 752, then you can get the loan easily and banks also offer the loan (SBI Home Loan) at the initial interest rate. To improve CIBIL, you have to make financial transactions and payments on time.
Identity Proof for Home
- your Aadhaar card
- PAN card
- Voter ID
- Photocopy of driving license and original of all these documents.
- All these documents are checks of the person applying for home loan in the bank.
- Along with this, you also have to provide your address proof which includes-
- electricity bill
- water bill
- postpaid mobile bill
- There are documents related to property tax.
- If you have your own business then you must have business address proof.
- Last three years’ IT returns and business license details
- Apart from this you have Employer Identity Card
- There should also be loan application and passport size photograph.
Take home loan at low interest rate like this
- Keep credit score above 750.
- Before taking a new loan, repay any outstanding loan in full.
- If there are two earning people in the house then apply for joint home loan.
- Pay your income tax every year.
- Apply for one loan at a time.
- While taking the loan, present all the documents related to your income.