Are You a First-Time Homebuyer? Here's How to Get a Home Loan | Fusion - WeRIndia

Many millennials dream of owning a home. Since owning a home is a significant investment, buying one can get overwhelming and challenging. In such cases, a home loan can help turn your dream into reality. But, you need to be well-versed in the specifics of how a home loan functions and what the requirements are, if you intend to apply. Let us have a look at a few basics.

An Introduction to Home Loan

A home loan is a financial instrument that helps secure funding for acquiring or constructing residential properties. To help the homeowners meet their specific requirements, banks, Housing Finance Companies (HFCs), and Non-Banking Financial Companies (NBFCs) offer numerous loan for house types that are listed below:

• Home Purchase Loan
• Land Purchase Loan
• Home Construction Loan
• Home Extension Loan
• Renovation Loan and much more.

Eligibility Criteria for Availing a Home Loan

The eligibility criteria differs from lender to lender, and borrowers must meet these criteria to avail home loans. Some of the primary requirements are as follows:

• You need to be between 25 to 65 years of age to avail yourself of the loan.
• You need to be either salaried or self-employed with a steady income source.

Furthermore, meeting minimum income eligibility can help borrowers avail home loans easily and instantly without hurdles.

Navigating the Home Loan Application Process

In this technologically advanced era, everything has become extremely easy and within our reach. You can easily apply for a home loan through online as well as offline medium. Listed below are the steps you must follow to apply for a loan for house with ease.

1. Select the Right Lender:

A vital part of applying for a home loan is choosing the appropriate lender. Different loan options and terms are offered by numerous lenders, including banks, credit unions, online lenders, and mortgage brokers.

Therefore, you must take into account aspects like interest rates, loan costs, customer service standards, and the lender’s reputation in order to make an informed choice. You can locate the lender that best suits your financial needs and goals by conducting in-depth research, comparing lenders, and receiving loan estimates.

2. Gather Necessary Documents:

Before applying for a home loan, you should prepare and organize all your financial documents at one place. Some of the necessary documents include proof of income and bank statements. Lenders will also require information about assets, liabilities, and credit history. Having documents readily available helps streamline the application process.

3. Submit the Loan Application:

Once you decide on the lender to rely on for the loan and have settled all the documents, you can proceed to submit the formal loan for house application. This application includes details regarding the property being purchased, the loan amount, and the borrower’s financial history. It’s crucial to complete this step accurately and honestly, as any discrepancies can lead to delays or even loan denials.

Based on the lender’s inspection and careful application of loan requirements, the lender will approve the request and will disburse the loan amount.

Now that you know how to apply for a home loan, let’s move on to learn what factors you must take into account when doing so.

Things to Consider Before Applying for a Loan for House

When purchasing a home for the first time, people often get overwhelmed by the variety of options, offerings, and interest rates available. Here are some considerations you must always bear in mind in order to help you relax and make wise decisions:

1. You must conduct careful study and compare quotations from several lenders if you want to meet your financial obligations and budget in the best way possible.
2. You must choose carefully between a bank and an NBFC because both options have their own set of benefits.
3. It’s crucial to enter the loan amount judiciously. You must assess your needs carefully and should refrain from applying for a higher loan as they usually result in a higher payback amount.
4. Choose the repayment tenure carefully. Be mindful of the EMI you need to pay every month and ensure that you do not overburden yourself.
5. The credit score is an important factor that helps in determining home loan eligibility. It represents your repayment capacity and helps to build trust amongst lenders. Therefore, before applying for a loan, you must take steps to improve your credit score.

Secure Your Dream Home with Hassle Free Home Loan

The journey of obtaining a home loan requires careful consideration of all the necessary steps. With the right knowledge, preparation, and determination, you can turn the key to your new home and embark on this exciting chapter of your life as a first-time homebuyer. Tata Capital is a leading NBFC that offers instant and hassle-free online home loans. These loans can be customized as per the borrower’s preference and are available round the clock at attractive interest rates.

Stay stress-free with a Tata Capital loan for house tenure of 5 to 30 years, available at affordable EMIs.

Image by Oleksandr Pidvalnyi from Pixabay (Source)