Getting a Home Loan In India

Decided on your dream home and now have to raise the funds? Fortunately bank loans are not
as difficult to get as they used to be. Its still a slightly long process, but then its always better to
know that everything has been checked thoroughly rather than keep having to run around every
three or four months. Here are the steps to go through:

1. Application
You need to fill up an application form which will ask for your basic information such as
address, employment details, income, education and so on. The form will also ask for the
property details like estimated costs etc. They will also ask you to submit verified photocopies of
certain documents such as

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

These are for security-both yours and the banks.

2. 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. The processing fees varies from
bank to bank and is generally between 0.25% to 0.50% of the loan amount. This fees is used by

the bank to start and maintain the home loan process including completing the various
formalities during the entire period.

3. Evaluation and Verification

Once all your paperwork is in, it takes a few days for the bank back after going through your
application and deciding your eligibility. If you pass this stage, a field verification begins for
which they send representatives to talk your family and neighbours as well as your colleagues to
verify that the information you have provided is correct. The references provided in the
application are cross checked and verified.

4. Repayment Verification
The bank now verifies your repayment capacity. After reviewing your credit records and bank
account details, if convinced that you will be able to make payments every month, the bank
sanctions your loans. The sanction can be conditional or unconditional. If the sanction is
conditional, youll have to fulfill the conditions imposed before the loan is disbursed. If they feel
that you will not be able to pay back the loan, they will not sanction your loan.

5. Offer letter for home loan

The bank then prepares an offer 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 offer letter, you will
have to provide an acceptance copy to the bank. This is generally a duplicate of the offer 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.

6. Property Verification
The bank sends representatives to verify the property you are looking to buy. For this, you have
to submit the original property documents. These include the title deeds, no-objection certificates
and other documents. The 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 dont lend for disputed properties and for titles where ownership cannot be easily
enforced.

Along with the legal check, banks also sends 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 is to ensure that the property has a clear title, is technically sound and
meets the valuation standards of the bank.

7. Releasing the money

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 banks 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.
Contact Us
MIDTOWN STRUCTURES
Beside Adarsh Palm Meadows,Opp.Skylark Greens
Ramagondanahalli Borewell Road,
Whitefield, Bangalore, KA 560066
Ph: 080 6050 2244
Cell: +91 99000 57 610, 99000 57 620
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info@midtownstructures.com