Home Loan Procedure
Read on to know how you can kick start your Home Loan application today.
Loan application form and documents
The first step in the home loan procedure is filling out the home loan application form. You will need to furnish personal and financial details to help the lender assess your loan eligibility. You will have to attach the following documents to support the information on the form.
Payment of processing fee
Lenders usually charge a loan processing fee that is non-refundable. The home loan processing fee may vary from bank to bank based on the loan amount. It is used to start and carry out the home loan process seamlessly. To save money, look for a lender that charges a low processing fee. For instance, IDFC FIRST Bank charges as little as up to 1% of the loan amount. .
Evaluation of the documents
The bank now evaluates all the information furnished by you. This is a crucial step in assessing your credibility. A bank representative may also visit your home or workplace to verify the details and check the references mentioned in the form. The lender then evaluates your credit history using the records in the CIBIL.
Property check followed by a legal check
If the property is not finalised, you can ask for some time from the bank. However, after you select the property, the lender will ask you to submit the original property documents, such as the title deed and no-objection certificate (NOC). The bank keeps these documents until you repay the loan to secure the principal amount. Once you provide the documents to the bank, it sends them to a lawyer for a legal check. The lawyer verifies the documents and approves them. In case of any discrepancies, the bank may ask you for more documents.
Technical checks and site estimation
The lender will perform a technical check and site estimation as part of the home loan process. A legal review of the property ensures there are no disputes involved and all titles are clear. A bank employee or a civil engineer is sent to the site if it is under construction to verify details.
Finalising and Signing the loan agreement
After completing all verifications, the final registration of the loan happens. The bank then drafts, signs, and stamps the final loan document.After completing all the paperwork, the bank will ask you to sign the loan agreement and submit post-dated cheques for the agreed term. Before signing the loan agreement, you must verify all the loan details, such as interest rate and type, loan tenure, EMIs, and other loan terms and conditions. You need to hand the original property documents to the bank. The documents remain with the lender until you pay off the entire loan amount.
Loan disbursal
After signing the loan agreement, the bank disburses the loan amount via a cheque according to the terms and conditions. If the property in question is under construction, the lender will disburse the sanctioned loan in parts according to the construction progress.
“Études has saved us thousands of hours of work and has unlocked insights we never thought possible.”
Annie Steiner
CEO, Greenprint
Join 900+ subscribers
Stay in the loop with everything you need to know.