Checklist for home loans - Various types

HOME loans are easy to come by these days. So, don't fret over it. Focus on the documents you need to furnish while applying for a home loan.

Documents required:

We give you a standard list of documents your bank will ask for. Besides this you need to submit details of the property or home you are obtaining the loan for.

Check with your Bank or Non-Banking Financial Companies to figure out which of the following documents you need to submit, as the requirements differ from bank to bank.

1. Identity proof

• Driving license
• Voters ID
• Passport
• PAN card
• Ration card
• Employee ID
• Bank passbook
• Letter from a recognised public authority or public servant verifying your photograph
• Confirmation letter from your employer or another bank verifying

2. Address proof

• Driving license
• Voters ID
• Passport
• Ration card
• Bank passbook or Bank account statement
• LIC policy/ receipt
• Utility bill – telephone, electricity, water, gas (less than 2 months old)
• Letter from any recognized public authority verifying residence address of the customer
• Letter from your employer

3. Age proof

• Driving license
• Passport
• Bank passbook
• PAN card
• Birth certificate
• 10th standard mark sheet

4. Income proof

Income proof and property proof vary for a salaried individual and a self-employed individual.

A. Self Employed/Businessmen

 brief introduction of Business/Profession

• Balance Sheet, profit and loss account statement of income, proof of income tax returns for the last 3 years certified by a CA
• Photographs
• Receipts of advance tax payments if any made
• A photocopy of Registration Certificate of establishment under Shops and Establishments Act/Factories Act
• Registration Certificate for deduction of Profession Tax
• Certificate of Practice
• Receipts of Bank loans
• Proof of investments (FD Certificates, Shares, any other fixed asset)

B. Salaried individuals

• Income Proof (any one of the following):
• Latest Pay slip
• Form 16
• Increment/Promotion letters
• Appointment letter
• Pay slip (Last 2 months) with salary account bank statement
• Certified letter from Employer
• IT returns ( for three years )
• Investment proof (FD certificates, shares, any fixed asset etc.)
• Documents supporting the financial background of the borrower (liabilities and assets if any)
• Photographs

5.Property Proof

Property documents

If a flat is purchased from a builder, you need the following property documents:

• Original copy of your agreement with the builder
• 7/12 extract - This is issued by the concerned land authorities giving details such as the survey numbers, area, date from which current owner is registered as owner etc.
• Property register card, which is obtained from the City Survey Department N.A. permission for the land from the collector, if its agricultural - If the land is agricultural and is being utilised for residential/ commercial/industrial use, then such agricultural land has to be converted to non-agricultural land and a Non-Agriculture Order has to be obtained from the Collector of the district where the property is located.
• Search Report and Title Certificate - A search report and title certificate can be obtained from an advocate who will conduct a survey of the title of the property by visiting the office of registrar. A legal opinion can avoid any legal hassles later and is mandatory to be filed with the agreement for sale.
• Development agreement between the owner of land and the builder.
• Copy of order under the Urban land Ceiling Act.
• Copy of building plans sanctioned by the competent authority.
• Commencement certificate granted by the Corporation.
• Building completion certificate.
• Latest receipts for taxes paid towards the land or property or flat to be purchased.
• Partnership deed or memorandum of association of the builders firm.

If a flat is purchased from a Cooperative Society, you need the following property documents.

• Original share certificate of the Society.
• Allotment letter from the Society in your name.
• Copy of the lease deed, if executed.
• Certificate of the registration of the society.
• Copy of the byelaw's of the Society.
• No objection certificate from the Society.
• 7/12 extract or property register card in the Society's name.
• Copy of N.A permission for the land from the collector.
• Search Report and Title Certificate.
• Copy of order under the Urban Land Ceiling Act.
• Copy of the building plans sanctioned by a competent authority.
• Commencement certificate granted by Corporation .
• The latest receipts of taxes paid for the property.
• Original Agreement to assign / Deed of assignment.

If you are constructing on your own land, then you will need the following property documents.

• Original sale deed of land and extract of Index II
• 7/12 extract or property register card in your name
• Copy of N.A. permission for land from the collector
• Search and title report
• Copy of tax paid under Urban Land Ceiling Act (obtained from Commissioner ate of Urban Land Ceiling and Urban Land Tax)
• Copy of the building plans sanctioned by a competent authority
• Building permission granted by the Corporation
• The latest receipts of taxes paid for your land
• Estimate of the cost of construction certified by the architect
• Confirmation of Rental Income
• Copy of the existing tenancy agreement, or a rental appraisal, from a local real estate agent signed by branch manager, or rental manager

Deposit or Investments

Evidence of your deposit or investment funds, ie a bank statement or term deposit receipt For low equity loans (5-19% deposit), copy of your savings account statements over the last six months

Sale and Purchase Agreement

If you are planning to buy a property, please provide a copy of the successful sale and purchase agreement signed by both you and the vendor. If you are planning to sell or have already sold your existing property, please provide a copy of that property's sales and purchase agreement

New Customer to the banks of India

If you are refinancing from another bank please provide copies of your loan statements covering the last six months.Please provide copies of your account statements covering the last six months from your current bank. Please provide copies of your identification and if you have arrived in the country within the last 5 years, please provide a copy of your passport

Home Loan Options

Types of Home Loans Available:

• Home Equity Loans
• Home Extension Loans
• Home Improvement Loans
• Home Purchase Loans
• Land Purchase Loans
• Mortgage Loans Many banks and financial companies offer home loans. But before choosing any home loan option, consider few points as mentioned below.

Property Types:

You should know more about type of property in lieu of which you seek loan. There are loans offered by banks to Resident Indians and NRIs for ready property, under construction property, self-construction and home improvement.

Loan Tenure:

The loans provided by financial institution are offered in tenures or period of years. You should check out the tenure for loans available in the market. There are loan tenures available for upto 25 years.

Repayment Options

You need to choose between fixed and floating rate home loans. Many banks and financial institutions will provide you with the option of switching from a floating rate home loan to a fixed rate home loan once a year at no extra cost. But you need to check out the facts first with the loan providing firm.

No Penalty option

There are also no penalty option offered by few finance companies. In this mode, you can opt to pre-pay up to 25% of your loan every year. Pre-payment is permitted after a minimum of 6 months following loan disbursal.

Tax Benefits

You should know the right of your tax benefits on home loans. Resident Indians are eligible for certain tax benefits on principal and interest components of a housing loan under the Income Tax Act, 1961.