Many people dream of buying a home without a home loan never becomes a reality. Once you like a house, then you start the process of home loan. A home loan is a financial instrument to buy a home. It is a secured loan and consists of several stages. Usually, it takes 15 days to get a home loan approved. Buyers and lenders go through many stages before reaching the final stage i.e. loan disbursement. Before applying for a home loan, please check your EMI on the home loan EMI calculator. Now let us introduce you to the process of home loan.
Apply for home loan
The first step is to apply for a loan. The application of each lender may vary. We will tell you about what information is asked in the home loan form. In this, you have to give information related to personal and professional, financial assets and liability.
Home loan review from the bank
The next step is to review and check the eligibility of the home loan application. During this time, the lender will check your eligibility and repayment ability. During this period the lender will check many things like income, age, nature and stability of job, number of dependents, current liability, repayment capacity, job verification, home verification, credit score and credit report etc.
If the bank considers you eligible for a home loan, then the lender will verify the property that you want to buy. The lender will send a lawyer to get a legal verification of the property. They will check the legal documents of the site visit and property. They will see if the property is caught in any legal trouble. If the lawyer is satisfied that the property is worth the investment, then he will submit a legal verification report to the bank.
The next step is to find out the fair market value of the property. The lender will send the experts to the site, so that the value of the property can be ascertained. The lender does this to ensure that sufficient loan for the property has been approved.
Home loan approval
After following the 3 steps mentioned above, the next step is to approve home loans. This means that you are ready to sign the documents of the home loan agreement. The home loan agreement is like a booklet, in which the terms and conditions of the home loan are written. If your home loan is approved, then you should start the process of property registration in your name.
Registration of property documents
The next step is to register the property in the sub-registrar office of your area. At the time of registration, you will have to pay the government’s registration fees and stamp duty.
Sign the agreement and submit the check for further dates: You will have to sign a lot of space in the agreement document. While signing the loan documents, you will also have to submit the check (post dated checks) in addition to the original documents. Checks for further dates will be for the initial 36 months.
After completion of all the legal procedures, the loan amount will be sent to the property seller through check or demand draft. The seller will provide the property’s papers to the bank. This means that the property papers (sales deed and mother deed) will remain in the custody of the bank until the loan is fully repaid.
Now that you have got a home loan and the property has been registered in your name, then you can enter a new house on any day of your choice. Interest on home loan will start accruing from the day the loan was approved, not from the day it was disbursed. So, try to get the loan disbursed as soon as possible so that you can enter the new house as soon as possible.