Yashika was buying her uncle’s house. It was a resale property but she still needed a loan to pay for it. The property was owned by someone she knew, so she was not too worried about legal issues and valuation related to the property. However, she still needed to run a few checks to ensure her home loan process was smooth. Her uncle helped her out with all the documents she needed, and also told her about other requirements.
If you do not have someone to guide you like Yashika did, worry not. We are here to help you. Listed below are the important checks you must make to get approval for your home loan.
- Financial condition
The bank will bear majority of the financial burden at present, but you will ultimately have to pay for the house. So, before you buy a house, make sure you are financially stable. Check that you can afford to pay the EMIs and the down payment. Remember, the lender will not give you the loan if they feel you cannot repay it. So, run a realistic check of your finances. Buy the house only if you are sure you can afford it.
- Property clearance
Whether you are buying a new house or an old one, ensure it has no legal issues. If the property is disputed in any way, the loan provider will not approve your loan. If you are buying a new house, get the verification and valuation checks done first. This way you can be certain that it is a legitimate house you are buying. The property should have all the necessary clearances from the authorities as well.
- Builder’s reputation
Check to see how the builder has performed in the past. Has the builder been able to hand over previous projects on time? Are customers happy? If so, you should not have any problems. But suppose the builder is known for delays in the projects or price disputes. If that is the case, it is advisable to avoid doing business with them. Lenders also prefer to avoid such builders, which is why they could reject your loan.
- Read the documents carefully
Before you sign on any dotted line, read all the documents carefully. Read the sale agreement, and the terms and conditions mentioned in it. Then read the terms and conditions of the home loan provider. See if the loan terms fit into your financial plan. This is an important check as it prevents future disputes from taking place.
The bottom line
Keep the guidelines mentioned above in mind and you will not have any problems when applying for a home loan. Buying a house is perhaps the biggest investment of your life. So, you must be extra cautious. Carry out the necessary checks to ensure that this is indeed your dream home.