Check to know all details before taking a housing loan
Posted on: 18/Apr/2017 12:37:29 PM
Most of us must have heard about getting a housing loan - how the people are made to run from pillar to post and are asked to present a whole lot of documents and certificates.
There are plenty of advertisements in the newspapers, magazines, TV and the radio regarding the offer for a housing loan. However, when the interested person approaches the company, they ask for a whole set of documents and tell other procedures delaying the whole process.
However, before complaining about the banks or the lending agencies, it is better from our end that we should be thoroughly prepared and how to get all the related news and procedures. Once the process is clearly understood, it is somewhat easier to get a housing loan.
The banks specify the age limit for applying for a housing loan. The banks also set the limits like depending on the monthly/annual salary the limit for the maximum housing loan that could be given. This limit varies from bank to bank. So, get all these information before starting.
The banks/lending agencies charge for processing the housing loan application and all related documents. This is known as processing fee. This processing fee is generally 0.25 percent to 1 percent of the amount of housing loan applied for.
Just like the trend in textile shops and consumer durable shops, the banks/lending agencies also offer some special concessions like waiving the processing once in while for a specific period.
A few banks return the processing fee once the loan is approved (Generally by adjusting in the account). However, it is very true that generally, the processing fee is not refunded.
Also, there is no guarantee that the bank will sanction the housing loan amount requested. We have also to make ready details regarding what other loans we have taken and the monthly amount being paid, etc.
Further, your saving account record will be scrutinised thoroughly. Your balance, the details of bounced cheques given by you, whether the credit/debit card is used properly, whether you are Income Tax payer - if yes, your IT fining return data, etc will be studied thoroughly.
For those who do not file Income Tax returns, loans may not be given. You have to furnish the details of the last 3 years of filing IT return.
An advocate has to endorse the details whether the land/plot is worth buying and also whether the buyer nd seller is qualified to do so. This advocate will be a member of the panel kept exclusively by the banks for these checking operations. He will submit the legal opinion after conducting a thorough check.
The candidate seeking housing loan will also have to supply an encumbrance certificate regarding the last 30 years data about the land/plot. House/flat being purchased. Some third person will have to be a guarantor. This person`s financial record will also be thoroughly checked. Though the house is yours, the bank will insure the same while offering the loan and collect the premium for the same from you.
There are special assessors employed by the bank. They will be the person who will fix the eligibility and amount of the housing loan after they complete their scrutiny.
Please do not indulge in paying any black money which is not accounted for. This is illegal. Also, if the value is shown as lesser, the amount of loan offered will also be less.
You cannot buy the house depending solely on the bank housing loan. You must arrange to pay 10-20 percent of the amount on your own. This is known as margin money. Some banks inform that they will release the housing loan only after this margin money is paid. In each installment that you are paying to the seller, the bank will contribute 80-90 percent whereas you have to pay the balance of 10-20 percent.
Until you close the housing loan, the Original sale deed and other documents will remain with the bank. So, it is always better to keep a certified copy of the sales deed and the ownership details.
