How To Apply For A Home Loan? Well Begun Is Half Done

If you are prepared with home loan information and documents before applying, your home loan application will sail through smoothly.

Applying for a home loan is the first formal step you would be taking towards buying your house, so be prepared. The amount of homework you do before applying determines how smoothly your application moves. Banks, housing finance companies, or non-banking financial companies usually go by the rule book to sanction credit, so you can do little to change the situation once you have applied. However, if you plan correctly and know what to expect, then you are almost there! Housing loan details are explained further.

Here is What you Can Do to Improve Your Chances

There is no such thing like easy home loan. Getting a house loan is tedious task but knowing about the whole procedure in advance will be of great help to fasten up your process of getting housing loan. Whether you apply online for home loan or offline keep all the necessary documents ready and handy.

Check Your Eligibility

Your eligibility for a home loan is dependent on your age, monthly income, repayment capacity, credit score, credit history, debts you owe, and your monthly financial obligations. Banks or housing finance companies consider these factors while determining the loan amount, interest rate, EMIs, and loan tenure. Before applying for a loan, you can calculate your eligibility by using online home loan eligibility calculators of the housing finance company of your choice.

Be Accurate and Leave No Scope For Ambiguities

Most lenders have a definite timescale to process your application, so if there is a delay, it could be possibly because of inaccuracies, errors, or simply missing information in your application form. A typical home loan application form requires detailed information about you, your educational and professional qualifications, income, expenses, liabilities, assets, debts, current employment or business, and the property you want to buy. Provide the correct information and make sure the details on the application form match the documents you supply to the lender.

Respond to Your Lender Promptly

While your loan application is under consideration, your lender may require additional documentation or clarity about certain information. You should make sure that you do not miss their phone or emails during this period. Your response should be prompt to keep your application moving forward.

Don’t Take New Loans

Before applying for a home loan, you should try to keep your credit record clean by clearing your existing debts or at least paying your installments on time. As far as possible, avoid taking new loans when your home loan application is in process. In some cases, your credit score may fall because of errors in the credit reference agency’s records. This error might result from lenders’ wrong information about your debt repayments or simply a misprint. It would help if you got the mistake rectified.

Keep Money Aside For Home Loan Down Payment And Stamp Duty And Registration

Banks or housing finance companies in India usually offer loans only up to 80 percent of the value of a home, and a homebuyer is required to pay the remaining amount. Similarly, stamp duty and registration charges, which form a bulk of a property’s cost, are also not included in the home loan. You must arrange these expenses beforehand to let the loan process move forward.

Who Can Apply For A Home Loan?

Lenders in India are generally open to offering home loans to salaried individuals, self-employed people – professionals and those running their businesses. Terms are the same for all home loan borrowers, but since eligibility criteria are different, they need to submit additional documents. Whether salaried or self-employed, all home loan borrowers must submit documents supporting their identity, age, and address, besides papers related to the property such as the sale deed and agreement for sale. These documents are in addition to those specific to their category.

Now we discuss about additional documents required by salaried employee and self-employed to get a housing loan.

Case 1: If you are a salaried employee, how to apply for a home loan?

Being a salaried person helps get a home loan because lenders find those with a steady income less risky than others. You can apply either online or by visiting the bank or the housing finance company’s branch in person. Below given are the documents a salaried applicant is required to submit for applying a home loan:

  1. Salary slips for the past three months.
  2. Bank statements of the past six months, mainly the account where the salary is credited.
  3. Copy of Form 16 or copy of income tax returns for the last two assessment years.
  4. Employment letter if you have not yet completed a year of service in the current job.

Case 2: If you are self-employed, how to apply for a home loan?

The application procedure is similar for all home loan borrowers, but those who are self-employed need to show proof of their financial position and that of their business or practice. The documents required include:

  1. Business address proof
  2. IT returns of the last three assessment years
  3. Balance sheet and profit and loss (P&L) account for the past three years
  4. Details of business licence
  5. Statements of the current account of the entity and savings account of the individual of the past six months
  6. TDS certificate (Form 16A, if applicable)
  7. Certificate of qualification if you are a chartered accountant, doctor, dentist, lawyer, architect, or other professional


Know all the possible requirements beforehand and approach the bank completely prepared. This can save a lot of time and hassles and thus help you walk through the loan process swiftly. Hope this article has helped you learn the minutest detail of the loan procurement process.

For more details check out these articles:

About to Close You Home Loan? – Here are a Few Handy Tips!
10 Types of Home Loan available in India | You Need To Know!

Author Bio

Devendra Bhandari

Do you have query?

Let our experts solve it for you while you rest

I need help to