Purchasing a house is a significant financial commitment, which can be a hurdle too big to cross for many. Moreover, the emphasis on income and its stability has made it harder for many Indians to own a house of their choice.
However, this scenario has altered in recent times, with financiers extending the tailor-made home loan for private employees. This has enabled individuals working in various organisations in the private sector to access the required financial backing to buy a property.
Nonetheless, before going ahead with a loan application, individuals should keep a handful of points in mind.
Things to know before taking a home loan for private employees
Here are some crucial factors to consider before applying for this credit –
- Eligibility requirements and documents needed
Every lending institution has a set of specific home loan eligibility criteria that one needs to meet to avail of required funds, irrespective of their occupation. Here are the highlights –
- Age: 23-70 years
- CIBIL score: 750 or above
- Monthly income: Depends on an applicant’s city of residence
- Work experience: As per the requirement specified by a particular lender
Since these eligibility parameters vary across lenders, so there can be additional requirements as well that one needs to meet.
Apart from this, individuals are required to submit certain documents to complete this application process. Here are the details –
- KYC documents
- Address proof
- Business existence proof
- Bank account statement of last 6 months
- Income proof (Salary slip, P & L statement, ITR documents etc.)
Other than this, applicants need to produce an allotment letter, payment receipt made to the real estate agent, sale agreement etc. Also, one must keep the home loan sanction letter as an essential proof during this application to avoid any unwanted hassles.
- Loan tenor and interest rates
Depending on the repayment capacity of a borrower, applicants can opt for an extended home loan tenor of up to 30 years and repay EMIs spread over a longer period. Opting for an extended tenor can help to keep the loan EMIs affordable, but it will increase the total outstanding. A shorter tenor will have an opposite implication. Prospective applicants can take assistance of a home loan EMI calculator to find a suitable repayment period.
Besides tenor, one should also take a careful account of the interest rate applicable on housing credits.
- Tax benefits on repayment
Another notable point to learn about home loans is the availability of income tax benefits on them. Individuals can enjoy tax benefits on the principal and interest components under different sections of the Income Tax Act. This advantage makes home loans an ideal option for borrowers, ensuring maximum tax rebate from their income.
- Additional charges
Home loans entail a series of additional charges that one should be mindful of, as they can drive up the total borrowing cost. This includes, processing charges, legal fees, property verification charges, and others.
Besides minding these additional fees, one should also go through the terms and conditions of a housing loan. It will help prospective homebuyers to avoid any future complications.
- Pre-approved offers
Borrowers can take a look at the pre-approved offers extended by reputed financiers on a wide range of financing options such as home loans, loan against property etc. These offers significantly reduce the hassle of lengthy documentation and accelerate the loaning procedure. Therefore, check your pre-approved offers by mentioning your essential credentials.
Apart from these above-mentioned benefits, the availability of online application and loan management further aid borrowers in this process.
Read More: A Comprehensive Guide on Income Tax Calculator
How to apply for a home loan online?
Here is a step by step guide on the application process of a home loan –
Step 1: Visit a financial institution’s official website
Step 2: Fill up an online application form with necessary personal, financial, and employment details that include age, monthly income, years of service, etc.
Step 3: For new home loan applications, individuals need to fill in the property details in the application form
Step 4: After the initial approval, individuals need to submit necessary personal and property documents online
With the submission of the application form, a representative from that lender’s side will connect the applicant for further title loans near me proceedings.
Therefore, knowing these factors will allow borrowers to avail of home loans for private employees conveniently and avoid complications in the long run.
