Complete List Of The Documents Required For A Home Loan

Finding the right home within budget according to the family requirements is a challenging task in itself. However, once the aspiring homeowners find the homes they want to buy, the next big thing they worry about is the finance. This is when they consider applying for a home loan. Even if the buyer has enough savings to fund the home purchase, taking a home loan has several benefits, like tax redemption, savings kept intact, less financial burden, etc.

However, as a home loan includes considerable amounts and long tenures, lenders request a long list of documents for home loan to carry out the rigorous inspection. With this, they want to ensure the borrower’s authenticity, credibility, and timely repayment. Hence, submit all the required documents after double-checking them when applying for a home loan. Submitting the wrong or inconsistent documents may get the loan rejected, and the individual’s goal of buying a home will remain a dream for longer. Besides that, a rejected loan application harms the applicant’s credit score, after which they may face difficulty getting approval from other lenders as well.

Therefore, it is essential to know what documents a home loan seeker must submit to get their loan approval quickly.

Documents Required for a Home Loan Application

An individual looking for a home loan must submit a few mandatory documents of proof to secure the loan. Here is a list of standard documents an applicant must submit to get their loan application approved:

KYC Documents

Submitting KYC documents is mandatory to apply for home loan. These documents provide crucial information about the applicants, like their age, income, address, income tax, employment, etc. Some necessary KYC documents include:

• Passport size photograph
• Age proof, like passport, birth certificate, PAN card, driving license, 10th class mark sheet, bank passbook, etc.
• Identity proof, like Aadhaar card, PAN card, driving license, passport, and voters ID card
• Residence proof, like ration card, utility bill, bank passbook, or account statement with employment letter or address

Financial Documents for Income Proof

When an individual applies for a home loan, banks, NBFCs, and other financial institutions scrutinize their income and credit history through their financial documents. They assess the applicant’s loan eligibility and calculate their repayment capacity to ensure repayment on time. That is why lenders request authentic financial records to ensure a stable and regular monthly income. However, remember that income proofs differ for salaried employees and self-employed professionals according to their work and income frequency.

Also, Check: Can I Get a Home Loan On a 40,000 Salary?

Loan applicants must provide these financial documents as income proofs to prove their regular income:

For Salaried Employees:

• Salary slips for the last three months
• Last two years’ Form 16
• Last six months’ bank statements
• Employee identity card
• Appointment letter, increment letter, or employer certificate, whichever is relevant

For Self-Employed Professionals: 

• Proof of business existence
• Last three years’ income tax returns
• Balance sheets certified by an accountant
• Last 12 months’ bank statements

Property Related Documents

Home loan lenders inspect the property to be purchased before approving a home loan for it. They want to ensure that the property is in the good physical condition and is located at a place with decent market value. If the borrower fails to repay the loan, the bank will foreclose and auction the property to recover its debt. So, they give due attention to the property and ask for the following list of documents for home loan depending on the property type:

For developer properties with the developer’s direct allotment:

• Allotment letter
• Sanction letter
• Payment receipt to the builder
• Builder-buyer agreement
• An approved copy of the building plan
• Mortgage permission from respective authorities

For resale properties:

• Registered sale agreement
• Possession letter
• Prior deeds from the property’s first allotment
• Conveyance deed or sale deed in favour of the seller
• Copy of the electricity bills
• Society Registration Certificate
• The property’s approved map
• Occupancy Certificate
• Society Share Certificate
• Land tax receipt and possession certificate from the relevant authorities
• No Objection Certificate from the society or builder
• Copy of the society maintenance bill
• Copy of property insurance

Those borrowing a home loan for a construction property need to give a detailed cost estimate and a complete breakup.

Buying a dream home has sentimental values along with economic stability. While looking for a housing loan, keep this list of documents for home loan ready and accelerate the process for faster approval.

Source: Complete List Of The Documents Required For A Home Loan