Documents Required For Home Loan

Home loans are granted by financial institutes and banks to eligible customers who want to buy a house. Extension of houses, renovation, remodelling, and repairing of your house are the other reasons that come under home loans provided by the banks.

If you are intending to apply for a home loan soon, make sure you are aware of all the documents required for home loan so that you are fully prepared when you apply.

The leading banks that offer home loans in India include the State bank of India, ICICI Bank, HDFC Bank, PNB Housing, Federal Bank, Union Bank of India, Kotak Mahindra Bank, Bank of Baroda, and other banks. Different loans offered by the banks require different documents.

Keep your home loan documents ready before you apply to avoid inconveniences. If you are wondering what the most important documents for home loans are, here are all the details of the documents that you will need before applying for a home loan in India.

It is extremely essential to keep all your necessary documents ready before you apply for any kind of loan In India. Your credit score for home loan matters a lot in determining your interest rates and other tax benefits that are offered by banks. For home loans, since the amount is large, the banks offer, a lot of documents are required before they grant your loan application.

Your document list may vary from another applicant due to several reasons. Your age, occupation, and source of income are taken into consideration while granting your home loan. Go through the home loan documents list mentioned below to make sure you do not miss out on any important documents that will be required when you apply for a home loan.

1. Identity proof

• Your Aadhaar card
• Pan card
• Passport
• Driving license
• Voter ID

2. Property Documents required for home loan

• Your NOC documents are provided by the housing society or builder.
• Sales deed
• Possession certificate
• Land revenue/revenue department receipt
• A detailed report of the entire construction cost
• Bank account details and a payment receipt showing the past payment details made to the builder or seller of the property
• Occupancy certificate for the constructed apartment

3. Address Proof

• Property tax report
• Electricity bill
• Telephone bills
• Above mentioned identity proof documents with your permanent address proof
• Postpaid mobile bills

These are essential documents required for housing loan. Apart from that, your passport size photographs are also essential when it comes to house loans.

Your bank statements address proof and identity proof documents are the essential housing loan documents that you need to prepare before applying for a loan to avoid all sorts of inconveniences. If you lack any of these necessary documents during the verification procedure, your loan application will not be granted by the bank.

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Although there are a few common documents required for all applicants across the country, salaried and self-employed individuals, need to separately carry a few documents specifically for home loans. The interest rate for self-employed individuals remains on the higher side compared to the salaried individuals.

For salaried individuals, their employers’ details, bank details, and past repayment records are mostly taken into consideration while reviewing their home loan applications. The major documents required for home loan for salaried person are listed below:

1. Application properly filled with signature and photograph
2. Identity proof- Aadhar card, Voter card, driving license, passport 
3. Age proof- birth certificate
4. Residence proof
5. Electricity bills, ration card
6. Employment letter
7. Bank statements with actress
8. Income Proof- Latest salary slips
9. Past bank statement records from last six months
10. Salary slips from the last three months along with bank details
11. Processing fee cheques
12. Income tax return reports
13. Challans as proof of income tax payment for employed businessmen 
14. Personal assets and liabilities statements

If you are a salaried individual, you have to focus on collecting the necessary salary and employment-based documents required for housing loan as soon as you can. If you lack any of these essential documents, your home loan application may get rejected by the bank.

Make sure you use a Home loan EMI calculator before applying for a loan to determine if you are eligible to apply for a loan. By using an online EMI calculator, you can also compare and contrast different home loans offered by different banks before you choose the right plan that suits your demands properly.

Home loan interest rates vary based on whether you are a self-employed or a salaried individual from one bank to the other. Your credit history, personal details, and monthly income are taken into consideration by the banks to determine whether or not you are an eligible applicant for the offered home loan.

The necessary documents required for housing loan are a bit different for self-employed people compared to salaried individuals. More documents of your business, business type, proof of partnership and other documents related to your business are required when you are self-employed. 

Here is a list of all the necessary documents needed for housing loan when it comes to self-employed individuals:

• Bank Account Details
• Pan card
• Aadhaar card
• Driving license
• Voter ID
• Passport size photographs
• Your statements from the bank account for the last six months
• Personal assets and liabilities statements
• Income certificates (estimated) as proof of income 
• Challans as proof of your advance income tax payment details
• Assessment orders from the last three years
• Profit and loss account statement of your business
• Details of your company/ business profile in details 
• Business partners names and details
• ROC registration certificate of your business
• SEBI registration certificate of your business
• Import and export code is associated with your business
• Trade license of your business
• Audited CA certified balance sheets, including your profit and loss statements for the last three months
• Tax returns and computation of income for three years
• Processing fee cheques

These are the major documents required for a home loan when it comes to self-employed individuals. More details about your business, business partners, business profile, and income receipts are required by the bank and other financial institutes if you are self-employed. 

Certain home loan tax benefits are also offered to salaried and self-employed individuals as per the Income Tax Act, 1961. The maximum deduction amount can go up to 2,00,00 for both salaried and self-employed individuals.

If you are an NRI applicant, you need to carry a few extra documents in order to apply for a home loan in India. Although there are some common documents that you need to carry, there are quite a few added documents that will be examined by banks and financial institutions in India while determining whether or not you are an eligible applicant.

Make sure you are completely aware of all the documents required for home loan if you are an NRI applicant to have a smooth application procedure ahead.

The major documents that NRI applicants need for home loans include:

• Identity proof
• KYC documents
• Proof of employment- labour contracts/ work permit/ other documents to prove your employment by the government of the other country
• Offer letter/appointment letter. 
• Salary slips from the previous 3 to 6 months that contain aspects like overtime, incentives, and other variable components.
• Copy of your passport to show the page of your residence visa
• Trade license, power of attorney, sponsor agreement, and other necessary business documents are required for self-employed NRIs
• Bank statement copies from overseas for the last six months
• For salaried NRIs, their income documents need to be attested by the embassy official
• Business details, business profile, business partners details, audited CA certified balance sheets are required for NRI self-employed businessmen
• Latest IT returns 
• Property documents with cost estimates from an Indian architecture engineer engineer
• If the applicant is not in India while applying for a home loan, a power of attorney needs to take over on their behalf to take the loan procedure forward.

These are some of the most necessary documents required for home loan. If you are an NRI, make sure you spend a lot of time collecting all the documents required before applying for a home loan in India. When you do not reside in India for a long time, your identity, address, income, business, and other details are examined more thoroughly by banks and financial institutions to determine whether or not you are an ideal applicant.

For floating interest rates, the rates may go up due to several reasons during your tenure. In this case, you can decide to shift your loan plan and choose a different bank as your new lender that will offer a comparatively lower interest rate. 

The major documents that you need to collect before applying for a home loan balance transfer are listed below:

• Letter of consent- Make sure you submit a formal application to your previous letter informing your home loan transfer scheme and ask him to provide you with a consent letter.
• A no-objection certificate is a must that states your previous lender has no issues with you transferring to a new bank.
• Your property documents are incredibly essential.
• A foreclosure letter stating your previous loan scheme is closed with a date is required before transferring your home loan to a new bank.

Apart from these, the common home loan documents such as your identity proof, address proof, income certificates, and other documents will be examined as well. 

Also Read - Tax Benefits on Second Home Loan