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Home Loan service provider in Pune

Home Loan

Each one of us wishes to possess a home of our own. With some pounds in your savings accounts, it won't be possible to purchase a home that requires a big investment. If you desire to own a home, Home Loan is the best way to finance your wish.

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Home Loan in Pune is offered against the value in one’s home. Equity can be defined as the value of the home after deducting outstanding Home Loan amounts and other loans. Home Loan Providers take various factors into concern while calculating the home value such as the location of the home, the structure etc. The loan will be secured on the borrower's home and the transaction will not impact current mortgage in any way.

A Home Loan in Pune is basically taken to buy or to construct a new home. Borrowers can also use it to make renovations, consolidating their current debts, to buy a luxurious car or for any other personal purpose. With the right planning and a right approach, you can avail an easy and beneficial Home Loan in Pune to fulfil your desire of possessing a home. Here are 6 tips for selecting your Home Loan Providers.

6 tips of choosing your home loan provider

1. Choose on the category of the property before fixing the loan provider.

Finalise the classification of the residence for which you would like to be financed by the Home Loan service provider in Pune. This is important because there are lenders who finance ready-properties only while there are others who would lend for properties which are under construction also. It is, therefore, imperative that you finalize the category of property you want to buy before selecting your Home Loan Providers.

2. Know your loan eligibility status.

Examine the Home Loan eligibility criterion from individual banks, which varies from bank to bank and select the one which would provide the maximum amount of loan depending upon your income data and history of credit. If you can arrange a co-applicant your combined income will be considered and your eligible loan will be increased.

3. Clarifications on Interest Rates.

The interest rates for borrowed capital may be set or floating/adjustable. Although the fixed interest rate normally remains unchanged throughout the tenure of the loan, sometimes such rate is adjustable after a certain period of time. This point, therefore, needs clarification beforehand from the potential Home Loan Providers. On the other hand, if you opt for a floating rate Home Loan it needs to be ensured that the potential banker's floating rate has a downward trend for the past 2/3 years.

4. The contract on the transaction of the non-refundable Handling fee.

A non-refundable fee is billed by the bank for the processing of an application for the Home Loan although transaction of such fee does not guarantee sanction of the loan by the bank. A fee for change in interest plan is also billed by the bank. There is, therefore, enough scope to have a negotiated agreement with the potential Home Loan service provider in Pune on the transaction of such processing charges.

5. Choose all the hidden expenses.

Although the bank charges several expenses which are hidden over an above the interest charges, mostly the interest portion of the costs is considered by the borrowers while taking the Home Loan. It is, therefore, prudent to negotiate with the Home Loan service provider in Pune all the hidden charges like legal fees, pre-payment expenses, valuation fees, processing charges etc before selecting him as your loan provider.

6. Be informed about lenders for making a choice.

Before deciding on a Home Loan service provider in Pune you should collect detail information about what each potential Home Loan Providers can provide to its customers and compare what each of them can provide you of what you are looking for to suit your needs.

Dream to own a home can come true with a Home Loan. Homebuyers are advised to search for reliable and trustable Home Loan in Pune and collect as much information as possible so that they can do comparison and shopping with an idea of what they want, can afford, and can qualify for.

About Home Loan in Pune Information and Guide

A Home Loan is a certain amount of fund which is borrowed from the lender against a residential property to be bought. It is usually taken for the purchase, construction or renovation of a property.

The housing loan may be availed either for buying a new house or resale of residential house. One can also avail a housing loan product, for the purpose of buying a plot of land and carrying out construction on the same, which is called composite loan.

Home loans in Pune are provided by the lenders up to maximum of 80% (90% for loan amount below Rs 30 lakhs) of the agreement value of the house. In case of home loan for resale flats, most lenders get the property valued independently and they will provide the housing loan based on their value rather than the cost mentioned in the purchase agreement. Frequently, the valuation as determined by the banker’s valuer for the purpose of home loan is significantly lower than the actual cost and hence the requirement of the borrowers for down payment for the loan goes up.

Home loans are repaid through monthly installments (EMI) spread over up to 20 years. Some of the banks provide housing loans even for a tenure extending up to 25 – 30 years. The maximum tenure of any loan and home loan specifically is also restricted by the borrower’s age at the end of the tenure so as to ensure that the loan gets fully paid by or before the retirement age.

Home loan Pune can primarily be classified into two categories on the basis of interest rates i.e. fixed rate and floating rate of interest. There are very few lenders in India who offer pure fixed rates where the rate of interest remains constant for the entire tenure of the home loan in pune, while most lenders have a reset clause of 3-5 years. In floating home loan type, the rate of interest on such loans is subject to change whenever there are changes in the repo rates announced by RBI or any changes in base rate of the bank. Borrower should opt for fixed interest rates only if she/he is certain that the rate of interest is the lowest in the interest cycle.

Nowadays some lenders have come up with innovative home loan products like dual rate of interest where the interest rate on such loans remains fixed for initial 1-5 years and thereafter it automatically moves to a normal floating rate of interest. Here one should be aware that loan taken under dual rate, which starts as a fixed type of interest in the initial stages are treated as fixed rate home loan for the purpose of levy of penalty for prepayment of loans.

In case where you prepay your housing loan the lender cannot levy any penalty for prepayment of such loan where the loan is taken under floating rate of interest as per the guidelines issued by RBI and National Housing Bank (NHB).

Loan Eligibility

Home Loan Pune eligibility depends upon various factors.

1. Income – Your income determines the amount of home loan you are eligible for. Banks generally keep the EMI to income ratio at 0.45 to 0.50.

2. Tenure - The longer tenure you opt for, the more is your home loan eligibility and the lesser is your EMI.

3. Age - Your age will determine your home loan tenure and hence your eligibility.

4. Interest Rate offered – Banks offer Fixed and Floating Rates of Interest. If your interest rates are on a lower side, then the loan eligibility will be higher..

5. CIBIL Score – Your credit report tells the bank about your repayment capacity and hence determines if you’re eligible for a loan.

Documents Required for Home Loan

1. Complete loan application form with one passport size photograph.

2. Photo Identity Proof: Passport/Driving License/ Voter ID/ PAN

3. Residence Address Proof: License/Registered Rent Agreement/ Utility Bill

4. Residence Ownership Proof: Sale deed or rental agreement

5. Income Proof: salary slip, bank statement and Form 16

6. Job Continuity Proof: Appointment letter at employment and validation letter from HR

7. Bank Statement: Past 6 months’ document

8. Property Documents: Sale deed, Katha, transfer of ownership

9. Advance Processing Cheque : A cancelled cheque for validation of bank account

10. Investment Proof: LIC, mutual funds, property document etc.

Financial Documents:

1. For Salaried Individual: 3 month salary slip, Form 16 and bank statement

2. For Self-Employed Individual: IT returns for last 2 years along with computation of income tax for past 2 years certified by a Chartered accountant

3. For Self-Employed Non- Professionals: IT returns for last 3 years along with computation of income tax for past 2 years certified by a Chartered accountant

Documents Required for Salaried Individual

1. Loan Form: Bank loan application form to be filled with passport size photographs affixed

2. Residential Address: Leave and License/ Registered Rent Agreement/ Utility Bill (up to 3 months old), Passport

3. Identity Proof: Passport/ Driving License/ Voter ID/ PAN

4. 3 month pay slip

5. Income Proof Documents

6. 2 years Form 16

7. Copy of Income Tax PAN

8. Bank Statement: 6 months bank statement that shows salary from the employer and any EMI paid for outstanding debit.

Documents Required for Self Employed– Professionals

1. Photo Identity Proof: Passport/Driving License/ Voter ID/ PAN

2. Residence Address Proof: License/Registered Rent Agreement/ Utility Bill

3. Office Address Proof: Property Documents, Utility Bill

4. Office Ownership Proof: Property Documents, Utility Bill, Maintenance Bill

5. Business Existence Proof: 3 years old Saral Copy, the Company Registration license, Shop Establishment Act

6. Income Proof: Latest 3 years Income Tax Returns including Computation of Income, Profit and Loss Account, Audit Report, Balance Sheet, etc.,

7. Bank Statement: Past 1 year bank statement

8. 1 passport size color photograph