Home Loan For Women Borrowers

Loan for women borrowers– new focus area of banks/ financial institutes.

Home loan for women borrowers
Women Borrowers – Lower Interest Rates

Home loans have become a popular way for the buyers to buy a new house; however, it has been observed that lately there has been a rising inclination of banks/financial institutes to motivate home loan for women. Successive measures by government and banks to encourage women empowerment and including women in all spheres of financial decision is a step in the direction of making women financially secure.

Some basic documents and criteria of loan for women borrowers:  
  • Loan application form
  • Passport size photographs
  • ID proof like voter ID, PAN Card, Adhar Card Driving Licence
  • Residence Proof like utility bills (electricity, telephone, water etc.)
  • Those women who are not salaried employees, they need to submit business address proof
  • Bank statement of last six months
  • Completed loan application
  • Passport size photographs
  • Proof of identify (photo copies of Voters ID card/ Passport/ Driving licence/ IT PAN card)
  • Residence proof (photo copies of recent Telephone Bills/ Electricity Bill/
  • Property tax receipt
  • Personal assets and financial liabilities statement
  • Details of other loans if any
  • A woman must be either the sole applicant or a co-applicant.
  • The property for which then loan has to be sanctioned should in the name of the woman applicant or she should be the first owner.

Special bank accounts for women, concessional rates and special loans for women borrowers, all directed in the direction to motivate women home buyers.

Let’s have an understanding about the special privileges that a woman home loan borrower gets from the bank / financial institutes :
  • Lower interest rate – The rate of interest levied on a home loan by banks or financial institutes is lower for women. It is lower by atleast 0.05%. For example : SBI has the scheme of HER GHAR, HDFC has scheme of WOMAN POWER
  • Better probability of home loan application being accepted – Under the guidelines of Pradhan Mantri Awas Yojana, preference is to be given to women. Widows, single working-women, persons belonging to scheduled castes and scheduled tribes, backward classes, differently abled and transgender people will be given preference. Women borrowers are perceived as less risky by banks and HFCs and hence they hold a better chance of getting their loans approved. Banks do consider other factors like credit score and documents before approving the home loan.
  • Lower stamp duty charges – In some states, if a property is bought in the name of a woman, the stamp duty levied is lower compared with what’s applicable for a man. For instance, in New Delhi, a woman has to pay 4% stamp duty compared with 6% for a man. This is also true in case of conversion of a property from leasehold to freehold, and in case of gifts.

One of the conditions as eligibility criteria for many banks for loan approval is presence of home loan co-applicant. Co-applicant is basically a person who acts as a guarantor and shares equal responsibility of repaying loan as the main applicant. Banks nowadays are insisting on having a co-applicant without educating the customer about its repercussion and legal liabilities. In case of women borrowers having a co-applicant increases your eligibility to avail high amount of loan but at the same time this can pose a few risks like:

    • Dispute between husband and wife – In cases where you have your spouse as a co-applicant but not the co-owner, you can face the problem of repayment of EMI. This is applicable vice-versa. Any kind of dispute in the future leaves the co-applicant male or female in a mess.
    • Asset risk of the co-applicant – In case the primary applicant fails to repay the EMIs, the burden falls on the co-applicant. Whether you are the co-owner or not you have to repay the loan.
    • Reduced credit eligibility- Being a co-applicant reduces your credit eligibility up to 50% which may impact your future loan applications.

Although, being a co-applicant poses some disadvantages it has some benefits too like:

  • Eligibility for higher amount – Having a co-applicant makes you eligible to apply for home loan of a bigger amount.
  • Tax Benefits –As per Income tax Act, 1961, you reap the tax benefits. Joint ownership can be beneficial if both the spouses take home loans as each can claim tax deduction for the interest paid on loan.

Note : It depends on the mutual understanding of the applicant and co-applicant; however, there is a legal way out for it. You can sign a document which clearly shows the liability of both and this can be executed on a stamp paper and should be notarized.

Loanyantra special cutter pack of home loan for women borrowers:

There are many companies offering loan for women borrowers but it is important that you are through with the legal aspects of the home loan. Loanyantra is a one stop shop solutions for your entire home loan requirement. You can easily connect with us and we suggest you how you can reap the maximum benefit out of the special home loan schemes for women. Moreover, Loanyantra also offers a discount of 0.01% on the home loan interest rate which is a discount on the bank / financial institutes interest rate.

Plan your home loan well and close it early. Get in touch with us today.

Home Loan Prepayment

I am a 26-year-old man, working in an MNC in Chennai. Last year I decided to buy a home for myself. Buying a home was my biggest dream and thanks to the lofty home loan policies that banks and HFCs are offering these days. I managed to buy a 2 BHK. Well, I succeeded in managing to bag loan from one of the government banks and got it at a reasonable interest rate.

Now, I am a satisfied person and secured that few years down the line, I will own my house. But one thing that always boggled my mind was if I wish to prepay my loan then what is the nitty-gritty associated with it. Since I work in private sector, I don’t have much time to run around the bank to fulfill the formalities and the paperwork.

Then, one of my friends suggested to go through LoanYantra, an online loan management company. Well, my association with LoanYantra proved to be a successful one and they gave great tips which definitely cleared the air that surrounded the idea of home loan prepayment. For many to avoid the hassle of running behind the banks, here I am sharing my knowledge of Home Loan Prepayment.

What is Home Loan Prepayment?

Home Loan Prepayment is paying an additional amount to the outstanding principal of the loan amount while you are in the Home Loan tenure. This additional amount is over and above the regular EMIs. This helps in reducing the principal outstanding which in return helps in reducing your EMIs and/or your home loan tenure.

It might sound easy but there is a slight catch. Banks typically levy a prepayment charge of about 2 – 3% of the outstanding loan amount. This amount is charged if you are repaying above a certain amount or you are switching your bank. Although most of the banks don’t charge extra. Thus, it’s advisable that you enquire while you apply for your home loan about the prepayment charges as well.

What You Should Know About Home Loan Prepayment 

Home Loan Prepayment can be a bit tricky as some lenders include extra fees.  In case of home loan, banks borrow funds based on the commitment for long period, these funds have to be re-assigned through credit channels for which bank has to pay additional cost. Thus, banks discourage the process of prepayment by leving an extra charge on the outstanding loan amount.

To Prepay the Home Loan, it is advisable for the concerned person to attend. If not possible,the authorized person needs to carry a letter which says that the respective person is authorized by the lender to repay the loan.

Note : RBI and the NHB have abolished penalty on home loan prepayment (home loans with flexible interest rate). So banks usually do not levy extra fess. But conditions apply.

Home Loan Prepayment Vs Tenure and EMI.

Home Loan Prepayment reduces the outstanding principal amount. So, this inturn reduces your EMI or tenure. It is always wise to calculate and choose.

Loanyantra’s Tip : It is better to reduce the tenure and keep the EMI constant. When you have an increment in the salary, you can increase the EMI which will reduce the tenure even further.

Do’s ad Don’t’s of Home Loan Prepayment:

  • Carry your ID proof (Aadhar is the most preferred one).
  • Carry your chequebook in case you need extra.
  • Also remember to mention your name, account number, home loan account number behind the cheque when you issue.
  • Collect all your previous cheques if you wish to change your EMI.
  • A proof of source of funds for your Home Loan Prepayment.
  • Make sure that you update your CIBIL database after home loan prepayment as it helps in reducing the outstanding balance and also helps in improving your credit score.
Home Loan Prepayment charges of some of the popular banks and HFCs
Banks and HFCs associated with Loan Yantra Home Loan Prepayment Charges
IDBI Not more than one prepayment in a month
DHFL 3% + Service Tax
Indiabulls ZERO
Axis Floating Rate Loan: Nil

Fixed Rate Loan: 2% of outstanding principal/amount prepaid


Words of Wisdom –

LoanYantra is committed to making a difference in the approach towards availing home loan and paying it back. We are known fro absolute customer satisfaction and we work on it continuously. Stay connected with us on www.loanyantra.com and get a planned calender, timely alerts and valuable suggestions on Prepayment of your Home Loan.

Understand hybrid home loans in detail!

Hybrid loan, according to RBI, is a two step mortgage. It is an ARM (Adjustable Rate Mortgage) that has one rate for part of the mortgage and a different rate for the remaining part of the mortgage. The interest rate changes in accordance with the market rates. The borrower, on the other hand, may have the option of making a choice between a variable rate or a fixed rate on the adjustment or agreement date. 

Hybrid loan products are popular options that package the advantages of both floating and fixed rate products.

Hybrid loans are popularly referred to as ‘partly fixed partly floating lHybrid home loansoans’ . This mixed option lends flexibility and greater choice to the home buyer. A part of the home loan is anchored under fixed rate and the rest is exposed to the prevailing floating rate of interest. This enables the borrowers to minimize the impact of adverse rate movements and benefit in times of favorable changes.

There are two options you can opt for after the fixed rate period of your loan is over. One is either you opt for a lower percent of your loan amount as floating and higher percent of the loan amount as fixed and vice versa, or the other option is you take a 50:50 for both the rates. Example for both the types is given below.

A homebuyer decides to take a loan for Rs 80 lakhs. If he feels that the rates are likely to move upwards in the coming months, he can lock 60 percent at a fixed rate. The remaining 40 percent is exposed to floating rate fluctuations. In case the interest rate goes upwards, the part of the loan locked under fixed rate remains unchanged. However, in the event the rate drops, the borrower will benefit only on the 40 percent of the loan that is under the floating component.

Some borrowers may decide to lock their loan at 50:50 under fixed and floating . This is the safest bet for homebuyers who cannot predict the future direction of rate movements. So the Rs 80 lakh loan is actually treated as two loans of Rs 40 lakhs – one at a fixed rate and another at the prevailing floating rate of interest.

So, your bank might ask you to sign two separate loan agreements-one for fixed rate of interest and the other for floating rate of interest. However, many banks may combine the same and use a single agreement for both the components. You must read the terms and conditions of your agreements with utmost care and your relationship manager is bound to explain to you, if you do not understand them.

When should you foreclose or convert from one component to other?

Under Hybrid loans, many banks offer you the option of foreclosing the floating component if the interest rates move up, with or without any pre-payment fees. And if the interest rates move down, may foreclose the fixed part, with or without pre-payment penalty, as per banks policies. Other banks offer you facilities such as converting your fixed portion to floating if the interest rates move down and converting the floating rates into fixed, if interest rates move up. Of course you will be charged a certain amount of fees for doing so, which can more often than not, be negotiated.

Some examples of hybrid loans include State Bank of India’s offer of SBI-Flexi Home Loans, HDFC’s 2-in-1 Home, Part Fixed,-Part Floating loan by ICICI and Bank of Baroda’s Flexi-home loans.

Though RBI discouraged the hybrid home loans for a period of time, now they are back again after a break of two years. Hybrid loan is recommended to those who are not ready to accept the frequent fluctuations in the EMI or for those who have to get used to the home loan for a period of time.A hybrid loan bails a borrower out of the dilemma of choosing between a pure fixed and a floating product.

Home Loan Documents-Upgrade the property with the same builder

Anand & Deepthi, a smart couple, had booked a 2-BHK, an under construction property from a reputed builder in their locality. Anand had a passion to buy a home of his own. With in an year of booking they became proud parents of twins. So to support the couple, Anand’s parents moved to his house. They were flood of relatives who came down to wish them. As Anand & Deepthi were working away from his home town, most of the relatives stayed atleast for a day.  Anand realized he needed his parents support to raise his twins and a 2 BHK would be small for them.

So Anand, wanted to sell this flat and buy a 3 BHK.  When Anand spoke to the builder, builder said he can upgrade to 3 BHK apartment from his 2 BHK apartment.  Anand had availed a loan and already 30% of payment got released from his home loan.

He wanted to know, “What was the process in Home Loan for upgrading a property ? “.  So, he got to know the procedure from the banker who requests him to submit the below documents.

upgrade the property with the same builder
Upgrade your property with the same builder
Documents to be submitted for Upgrading a Property.

1)      Original Cancellation Deed required.

2)      Disbursement Against Registration.

3)      Letter from Builder about the property swap & OCR transferred to New flat no.

4)      Loan to be increased or downsize.

5)      2 cheques required from salary account.

6)      Original Agreement of sale copy.

Anand submits all the above mentioned documents. It took him more than a month to do the entire process.  Now he was happy as he had prepared his sweet home for the future.

Home Loan process for Swapping Flat


Statistics show that 1 in every 100 buyers upgrade their property after they had blocked it.

Loanyantra takes this platform to let you know more about Upgrading the property : 

Some famous justifications include for us Indians to upgrade the property are  “my family needs more room”, “we can free up some cash for our children’s education (or buy a car!)”, or “I’m sure we can make some money from selling the bigger house and downgrade after the kids grow up”.

So, what to know before you upgrade the property –

Are you in the financial position to upgrade? If yes, then cross check if you are aware of the below mentioned points, to ensure you are in the correct line.

  • Have you got the registration sale deed or Agreement of Sale?
  • You need to get the NOC from the builder and you can enter into a Deed of Exchange and you have bounden duty to pay the additional amount in respect of 3BHK.
  • Moreover, if you got the registration of Sale Deed, you have another option also, you can resale the flat to the builder by execution of Resale Deed by receiving your total consideration amount. Later, you can enter a fresh Sale agreement for 3BHK.
  • Also another option involved is Gifting the property to the builder. But please know all the legalities from your lawyer.
What Loanyantra can do when you upgrade the property.

Loanyantra can take care of your home loan and helps you in submitting the right documents. Enjoy the door-step service.

Let us know once you are done with the registration, we will carry forward the rest of the process with the bank you choose.

Always wishing to serve you – Loanyantra.com

PMAY by DHFL – Jan Awas Home Loan

PMAY by DHFL is brought to the customers in the name ‘Jan Awas Home Loans’

DHFL, the third largest home loan and housing finance company in India, always aims at reaching to its customers with great service and perfect information.

pmay by dhfl
Jan Awas Home Loans

Home is one of the primary needs of every human being. It is in a home that new dreams are nurtured & families are raised.

At DHFL, they vision to enable every Indian to own a home of your own. With the Government’s initiative under ‘Pradhan Mantri Awas Yojana’, DHFL introduces ‘Jan Awas Home Loans’ exclusively for Economically Weaker Section (EWS), Low Income Group (LIG) and Middle Income Group (MIG) 1 & 2 customers under Credit Linked Subsidy Scheme (CLSS). This Scheme is in-line with the Govt. Of India’s initiative “Housing for all by 2022” & aims to make the dream of owning a house for thousand a reality. The product is to target EWS, LIG and MIG 1 and MIG 2 customers in the urban market. First time home buyers i.e. a household who does not own, at present, any pucca residential house in India and wishes to buy a dream home for his/ her stay may avail the benefit under this scheme.

Features And Benefits of PMAY by DHFL – Jan Awas Home Loans

  1. Loan Amount: For EWS and LIG, avail a Home Loan of up to ` 25 lacs including insurance, and for MIG avail a home loan up to ` 140 lacs including insurance (minimum loan amount ` 50,000 excluding insurance).
  2. Tenure & Term: The tenure of your Home Loan ranges from 1 to 30 years. The term, however, does not extend beyond the retirement age or 60 years, whichever is earlier (70 years for self-employed individuals).
  3. Purpose: Credit Linked Subsidy will be available for housing loans availed for new/ resale purchase of home, construction loan for all segment and additionally for EWS/ LIG, extension / improvement of rooms, kitchen, toilet etc., to existing dwelling can be done.
  4. Interest Subsidy: For EWS and LIG, the credit linked subsidy will be available only for loan amounts up to ` 6 lacs and such loans would be eligible for an interest subsidy at the rate of 6.50% p.a. (Approx. ` 2.67 lacs), for tenure of 20 years or during the tenure of loan whichever is lower, to the eligible customers under the scheme.* For MIG 1 customers, subsidy will be applicable for loan amounts up to ` 9 lacs and such loans would be eligible for an interest subsidy at the rate of 4% p.a. for tenure of 20 years. For MIG 2 customers, subsidy will be available for loan amounts up to ` 12 lacs and such loans would be eligible for an interest subsidy at the rate of 3% p.a. for tenure of 20 years.
  5. Processing Fees: Nil**
    Processing Fees on loan amount as per maximum subsidy applicable (as per customer applicability) to be refunded once claim is received from NHB.
  6. Easy Repayments: You have 2 options for repayment of the loan based on the EMIs payable on your Home Loan
    1. Through ECS (Electronic Clearing Service) based on standing instructions to your bank.
    2. Post Dated Cheques (PDCs) drawn on your Savings/Salary account.
  7. Home Loan Tax Benefits: Resident Indians are eligible for certain tax benefits on principal and interest components of a home loan. As per Income Tax Act 1961 rules, the current applicable exemption under section 24(b) is ` 2,00,000/- for the interest amount paid in the financial year and up to ` 1,50,000/- (under section 80 C) for the principal amount repaid in the same year.
  8. Applicant and Co-Applicant: Home Loans can be applied by an individual. The loan amount can be further enhanced by including an earning co-applicant. Female property ownership mandatory for EWS/ LIG category and not mandatory for MIG category.

*Terms and conditions apply.
**Other charges as applicable will be required to be paid for availing the Loan

Eligibility For PMAY by DHFL – Jan Awas Yojana

  1. First-time home buyers who will be the end users
  2. Female property ownership mandatory only for EWS/ LIG and not mandatory for MIG 1 & MIG 2 category (for EWS/LIG customers, only in cases when there is no adult Female member in the family, the property can be in the name of male member of the household, or in cases of construction loan, if land is purchased before the scheme start date, the property may be in the name of male member of household).
  3. Loan applicant should not have availed any central or state government subsidy or benefit for housing under PMAY.
  4. Individual loan applicant should not own property under his or her name at present & along with any of the family members including dependants.
  5. Not applicable on renovation or improvement loans for MIG.
  6. Property should be in urban areas basis 2011 census.
  7. Customer Category
Economically Weaker section
Low Income Group
Middle Income Group 1
(MIG 1)
Middle Income Group 2
(MIG 2)
Household Income in ` Annual Family income up to
` 3.00 lacs
Annual Family income from
` 3.01 to
` 6.00 lacs
Annual Family income from
` 6.01 to
` 12.00 lacs
Annual Family income from
` 12.01 to
` 18.00 lacs
Subsidy 6.50% 4.00% 3.00%
Scheme Validity 2022 1 year from January 2017
Maximum Loan Amount (on which subsidy is available) ` 6 lacs ` 9 lacs ` 12 lacs
Maximum Tenure 30 years 30 years

Subsidy Advantage Under PMAY by DHFL – Jan Awas Home Loan


Example Example 1 Example 2 Example 3
Value of the property Rs.6,70,000 Rs.10,00,000 Rs.13,50,000
Loan to value 90% 90% 90%
Loan amount Rs.6,03,000 Rs.9,00,000 Rs.12,15,000
Loan duration 20 20 20
CLSS Subsidy at 6.50% for 20 years

(PMAY – EWS and LIG)

Rs.2,67,280 Rs. 2,67,280 Rs. 2,67,280
CLSS Subsidy at 4.00% for 20 years

(PMAY – MIG 1)

Rs.1,57,496 Rs.2,35,068 Rs.2,35,068


CLSS Subsidy at 3.00% for 20 years

2,30,000 (PMAY – MIG 2)

Rs.1,15,653 Rs. 1,72,061 Rs.2,30,156


Documentation for PMAY by DHFL – Jan Awas Home Loans 

No. Document Name
1. KYC Documents & Photograph for all applicant.
Aadhar is mandatory for all applicants.
2. For Salaried: Salary slip or Certificate & updated bank statement
For Self Employed: Income Tax Returns with other financial of last two years and bank statement.
3. For identification as an EWS or LIG beneficiary under the scheme, an individual loan applicant will submit self-certificate/affidavit as proof of income.
4. Customer declaration undertaking
5. Additional Jan Awas Application form

PMAY by DHFL – Jan Awas Home Loan Via Loanyantra – 

Planning to buy a home? If you had short-listed DHFL as one of your home loan finance options, we are with you at the knock of your door to fulfill a smoother process. Getting into loan with loanyantra is not just availing home loan but also managing your loan till the end. Loanyantra will also ensure you get the loan for the required from the best fit banks or housing finance companies.

Plan your loan well with the subsidy scheme and close it earlier than expected.

Home Improvement Loan Vs Top-up Loan

Home loan is a crucial one when you go for your dream home.

It is always important to beautify your home to add more happiness. For such kind of necessities, you need to work on your financials again after paying the down payment and after you start your EMI for your home loan. Home Improvement Loan is one such loan to fulfill all your needs.

The interiors of your house reflect your personality and to constantly upgrade it in terms of looks and convenience, all the banks and housing finance companies provide Home Improvement Loan.

Home Improvement Loan covers-

  • Complete renovation of already owned residential property
  • Upgradation
  • Repair of your house/flat
  • External & internal repairs/paint
  • Water-proofing & roofing
  • Tiling and flooring
  • Plumbing & electrical work
  • False ceiling & woodwork (fixed to the building)

What you should know about Home Improvement Loan :

  • The rate of interest usually is same as for home loan.
  • 80% of the property value is the maximum amount valid for home improvement loan.
  • Repayment period is same as for home loan.
  • You can repay the loan even before the tenure but check for repayment fees.
  • You can claim tax deduction when you are in home improvement loan. Both the co-borrowers can claim deduction.
  • Banks do not provide home improvement loan for a property which is older than 35 years.
  • Pay processing fees.

There is also an extensive range of home loan products like Home Purchase Loans, Home Construction Loans, Home Extension Loans, Home Improvement Loans and Plot Loans.

One will always think of top-up loan when in need of money.  Top-up loan is used when there is an immediate financial need. It is always recommended to go for a top-up loan if you are already in a home loan.

Everybody aims for a higher growth. For the steps to go forward in life, you might need a lump-some cash anytime. For such reasons exists, top-up loan on home loan.

Top-up Loan covers :

  • House renovation
  • Medical
  • Marriage
  • Education
  • New investment
  • To repay any other debt

What you should know about top-up loan : 

  • You can avail top-up loan only if you have an existing home loan.
  • The rate of interest usually is 0.5% – 1.00% more than the home loan interest rate.
  • 80% of the property value is the maximum amount valid for top-up loan.
  • The eligibility is based on your credibility and other loans.
  • Repayment period is same as for home loan.
  • You can repay the loan even before the tenure but check for repayment fees.
  • You can claim tax deduction when you are in home improvement loan. Both the co-borrowers can claim deduction.
  • Need to pay processing fees.

Everything is similar when you compare home improvement loan and top-up loan. If you have to choose one, give yourself the ratings for both the loan types based on the interest rate. Also, if you foresee any future financial necessity other than home renovation, it is better go for a home improvement loan when you are in need of any home remodeling.

Loanyantra helps you build the bridge between you and banks/financial institutes. To get a hassle-free guidance and home loan help, we are just a missed call away. Plan your loan well and close it early. Invest more and earn more.


When does Home Loan EMI start?

Your Home Loan EMI starts from the time the Bank has created a disbursement cheque. Some banks start your EMI from the date you picked the first disbursment cheque even before you have

First EMI is called broken period EMI. Which is lesser than your EMI.

What is Broken period EMI?

When you opt for EMI payment, say 5th of every month. Now suppose your disbursment cheque is handed over on 25th of the month. Then Bank would calculate interest for 25th till 5th of next month.. say for 10 days and it would take it on 5th. The next EMI will be as per your EMI schedule.

Again you can go for Pre-EMI or Full EMI. I would suggest if you are capable of paying full EMI then start with Full EMI. Most of the times Banks will keep it to Pre-EMI for under construction properties. Which will not decrease your loan tenure.

Plan your loan well, then only you will close it faster and home will be fully yours.

If you already have existing home loans then to plan well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

If you are looking for Home Loans and want to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

How bank calculate interest, is it really 8.5% when they say it for home loans?

One should understand well to mange the home loan well else manage your loan for free on Home Loan Management Company India: LOANYANTRA

Interest rate consist of 2 components.

Interest Rate = Margin Rate + MCLR Rate for specific period or Base Rate

When you avail a loan for 8.50% that would be broken up into

8.50 % = 0.50%(Margin) + 8.00% (1-Year MCLR)

Its confusing right.

When ever you take a loan either Fixed or Floating the margin on that day gets fixed.

In case you loan is floating, then the floating will depend on the MCLR Rate for the specific period. Normally most of the banks give you for 1-year. Meaning every 1-year your rate would change as per that days MCLR for that period.

Say after year 1-year MCLR is 9.75% then your interest rate would be 10.25%.

10.25% = 0.50% + 9.25%

For more details you can check the blog : Demonetisation effect on Home Loans – Get Home Loan Online In India

Which is most preferred bank for home loan in India?

Home Loan depends on following factors

  1. Your Salary or Your Business turnover
  2. Your age
  3. Your Existing Loans
  4. Your Credit Score.
  5. Last but not the least the Property you are buying & Own contribution to pay 20% of the property
  6. Location , approvals of the property.

Your Salary : You should be earning enough to pay the 80 lac EMI.

Your Age : Based on your age, maximum Loan tenure will be decided. Before you retire i.e 58 years you should be clearing the loan.

Existing Loans : If you have any exiting Loans, you will be paying EMI so you overall eligibility would come down for the next loan.

Credit Score : Banks/NBFC would look at your credit report and based on how you have paid will decide to go if they want to give you loan

Property : When you are asking for Rs 80 lac loan, it would mean at least the property should be Rs 1 crore. Technically the price of the property should support it and you have to pay 20% from your self funding and 80% you can take loan. It should not be like for Rs 10 Lac property you are paying Rs 1 Crore.

Approvals of the property : Based on the Location and type of approvals and amount of deviation while constructing banks would take a call if they will be giving loan or not.

So based on the property you have selected and based on your financial profile you need to select the bank and the loan product. Some not so famous banks will have better products for certain properties.

Plan your loan well, so that you will close faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

Guide to the Home Loan Process

Buying a home is one of the major decisions a person has to take during his life. It is rare to find someone who pays the entire cost of home at one go. A home loan is an essential part of any home buying endeavor. Taking a home loan is a long journey, which involves many stages. The key to getting your home loan in a smooth way is being familiar with the entire home loan process.

Know the home loan process before-hand
Beginning the home loan process in India

The process of getting a home loan starts with a formal application for the loan. The application form requires certain basic information about you. This will include your personal, residential, income, employment, educational details and details about the property, estimated costs and current means of financing the property. Though the requirements may vary from bank to bank but there are certain things which every bank will ask.

The application form must be supported with valid documents to substantiate the facts. Generally the banks will ask you to submit following documents.

  • Income proof
  • Age proof
  • Identity proof
  • Address proof
  • Employment details
  • Proof of educational qualifications
  • Details about the property if finalized
  • Bank statements

Proof of income : This will need to be backed up by proof such as copies of last three years’ Income Tax returns (along with copies of Computation of Income/Annual accounts, if any), Form 16/Form 16A, last three months’ salary slips, copies of the last 6 months’ statements of all your active bank accounts in which your salary/business income details are reflected, etc. Other documents that you need to provide with your application form include age proof, address proof and identification proof. You may also be asked to give your employment details.

Age proof : Copy of your school leaving certificate/Driving license/Passport/ration card/PAN card/Election Commission’s card/etc.

Identification proof : Same as above, but with photograph. Sometimes, the same document if it contains a photograph, the current residential address and the correct age can be the proof for all 3 things.

Address proof : Similar documents need to be provided to prove that you are actually staying at your current address.

Your employment details: If your company is not well‐known, then a short summary about the nature of the company, its business lines, its main customers, its competitors, number of offices, number of employees, turnover, profit, etc may be needed. Usually, the company profile that is available on the standard website of the company is enough.

Educational qualification : The copy of certificates of your higher educational qualification needs to be submitted.

The purpose of the entire exercise is to ascertain the suitability of an applicant for a home loan. The income documents and bank statements provide vital clues to the bank regarding your financial health.

Processing fees for home loans in India. : An important thing to note about home loans is the processing fee. Banks charge a processing fee for every home loan application. This fees is non refundable. This fees is used by the bank to start and maintain the home loan process including completing the various formalities during the entire period.

Evaluation and verification of home loan applicant : After applying successfully for the home loan and submitting the processing fees, the bank evaluates your application, decides in principal about your home loan and requires a personal meeting with the bank officials. This decision for personal interaction can be taken within 2-3 days of submitting a complete application. The purpose of this personal interaction is to know more about the borrower and his repayment capacity. Being satisfied by your application and personal interaction, the bank proceeds to verify all the facts that you mentioned in your application for home loan. A field investigation process is initiated – to confirm and validate everything stated in the application form. Qualified representatives are sent by the bank to your office and place of residence to ascertain the facts. The references provided in the application are cross checked and verified.

Verification of repayment capacity : Once the field investigations over, the bank now goes ahead to verify your repayment capacity. This is the most vital part of any home loan process. If the bank finds that you’ll not be able to repay the money back with interest on time, it will simply deny you any home loan offer. On the other hand if the bank finds that all’s well and is convinced by your repayment capacity, it sanctions your home loan. Based on how well the bank is satisfied by your financial conditions and repayment capacity the bank can issue a conditional sanction or unconditional sanction. If the sanction is conditional, you’ll have to fulfill the conditions imposed before the loan is disbursed.

Sanction letter for home loan : The bank then prepares a sanction letter which contains the following detail:

  • The amount of home loan sanctioned
  • The interest rate applicable on your home loan
  • Whether the interest rate is fixed or floating
  • Your home loan tenure
  • The mode of repayment of the home loan
  • If any special scheme applies to the home loan, its details
  • The terms and conditions associated with the home loan

If you find the offer attractive and agree with all the facts mentioned in the sanction letter, you will have to provide an acceptance copy to the bank. This is generally a duplicate of the sanction letter signed by you, provided to the bank for its records. If the bank charges any administrative fee, it will have to be submitted at this stage.

Verification of the property : Now the bank will verify the property in question. The home loan is a secured loan with the property being used as the security or collateral. So, to get the home loan you must submit the original documents of the property to the bank. The title deeds, no-objection certificates and other documents required by the bank are to be submitted in original and the bank keeps them safely until you repay the entire loan amount. After taking the papers, bank conducts a legal check so as to verify that the property has a clear title and the home loan is being disbursed to the right person and for the right reasons. Banks don’t lend for disputed properties and for titles where ownership cannot be easily enforced.

Along with the legal check, banks also send experts to the location of your property to conduct a technical valuation. If the property is under construction, the banks verify the stage of construction, quality of construction, progress of construction, locality etc. and evaluate the property on established parameters. In case where the property is ready or is being resold the bank verifies the ownership, maintenance, age of property, quality of construction, locality and required legal clearances. The banks have qualified valuators, which assess the value of property on various parameters and decide on the amount of loan

The sole purpose of all this exercise is to ensure that the property has a clear title, is technically sound and meets the valuation standards of the bank.

Note: Verification is not necessary if loan is being sanctioned by a tie-up Bank.

The disbursal of home loan : Once the formalities are completed and the bank is satisfied with the legal, technical and financial valuation of the property, the registration process for the home loan begins. The legal documents are to be prepared on stamp papers of required denominations in a format approved by the bank’s lawyer. The home loan agreement is then signed and you need to submit the post dated cheques for the agreed term. After the home loan agreement the loan disbursal process begins. Depending on the home loan purpose, and the agreed type of disbursal (lump sum or in stages), banks disburse the home loan amount.

Income Tax certificate

Every bank issues an income tax certificate that serves as requisite proof to let you avail of tax benefits that accrue on repayment of a home loan. This will typically contain the total amount of interest and capital repaid during the year. This is mandatory to claim the tax benefit in respect of self-occupied property. You will have to file this with your tax returns and submit this to your employer or chartered accountant to calculate your tax liability.

How Loanyantra Works During the Home Loan Process :

It is our work to make you feel at ease during the process. We are here to make you select the best and your favourite bank. We ensure that your process is smooth as we send you alerts and remainders about each step before even the agent comes to you. You can always contact our relationship manager for any queries.