For many aspiring homeowners, obtaining a Housing Loan is essential to fulfilling the cost of purchasing their dream abode. Nevertheless, since Home Loans concern with tremendous funds, a Housing Loan application is approved only after strict examination to ensure on-time loan repayment without any payment defaults.
Therefore, when you register an application for a Home Loan, always ensure that you present all the proper documents. It is essential to remain well-versed with the Home Loan documents required to guarantee that your loan gets sanctioned instantly.
What Are the Documents Required to Avail of a Home Loan?
To obtain a Home Loan from any reputed bank or financial institution, the loan applicant must present specific documents of proof considered compulsory. Here is a standard list of Home Loan documents you must submit to get your loan application sanctioned:
Proof of Income
Different financial institutions or banks in India carefully review the Home Loan applicant’s earnings and financial records to evaluate their loan eligibility and repayment capability. Almost every bank in India demands original papers documenting that the loan applicant earns a regular monthly income. So to avail of a Housing Loan in India, loan applicants must offer the following documents to verify they make a regular monthly income:
- Bank account statement for the past six months
- Latest salary slips for the preceding three months
- Form 16 (Part A & Part B) and filed Income Tax Returns (ITR) for the past two years
- Appointment Letter/ Increment Letter (as relevant)/Employer Certificate
- Employee identity card
- Proof of identity (PAN Card/ Aadhar Card/ Passport/ Driving License/ Voters ID Card)
- Passport size photograph
- Age proof (Passport/ PAN card/ Birth certificate/ Bank passbook/ Driving license/ 10th Marksheet)
- Proof of residence (Ration Card/ Telephone Bill/ Electricity Bill/Passbook or Bank Statement with address/ Employment Letter)
Before accepting a Home Loan application, banks in India usually evaluate the applicant’s property. In addition, in case of an installment default, the banks, and financial institutions can auction the borrower’s property to recover the defaulted payments. Moreover, the property documents that Home Loan applicants need to submit while applying for a Home Loan are as follows:
- Sanction letter
- Chain contract from the previous owner
- Commencement certificate
- Registered agreement for sale
- Approved building plan copy
- Payment receipts to the builder
- Registration receipt
- Occupancy certificate
- Society maintenance bill copy
- Society share certificate
- NOC (No Objection Certificate) from society
- Society registration certificate
- Possession letter / Allotment letter
- Copy of electricity bill
- Property insurance copy
Under property documents, you must also submit the following documents:
– Purchase Agreement
It is one of the most important property records for a home loan and is also known as the Agreement for Sale. You’re probably wondering what the Sale Agreement is. The Sale Agreement, on the other hand, is a written contract between a buyer and vendor to sell an immovable asset.
It will include all of the specifics (terms of service) of the property sale that will take place between the buyer and seller in the future. A Sale Agreement grants you no rights or interests in the property.
– Deed of Sale
A Sale Deed is the most important proof of property ownership, also defined as the Final Deed or Conveyance Deed between lenders. Many people mix up the Sale Deed and the Contract of Sale. A Sale Agreement is a promise to transfer property, whereas a Sale Deed occurs when that promise becomes an actuality. You must submit your Sale Deed if you apply for a home loan. This sale deed usually guarantees that the property belongs to the loan applicant and that the actual transaction took place between the buyer and seller.
– Khata Certificate
When you purchase a new house by availing of a home loan from any bank, the officials usually check if you own registration on the new real estate property. For this very purpose, banks or financial institutions use Khata Certificate, an essential property document for obtaining a Housing Loan. This Khata certificate is one of the Home Loan documents that offer proof that the property you are applying for a Home Loan is appropriately registered in the regional municipal records and holds a sanctioned construction plan.
Financial institutions and banks provide Home Loans to qualified customers who wish to purchase a home after verifying all the submitted documents and the borrower’s credit history. So, if you plan to apply for a Home Loan soon, ensure you know all the documents needed so your loan application never gets rejected.