Your home is one of the most significant investments that you will make in your life. That is why most people opt for financial assistance. Many banks provide home loans to help people get their dream houses. However, certain documents are required to apply for a Home Loan. In this article, we will assist you with all the details about the documentation needed for getting the Home Loan.
Why do banks require a list of documents for home loans?
Banks often need a List of Documents for a Home Loan to check how eligible you are for the loan. Since housing loans are usually a big amount, banks can only give financial support if the documents are correct. They need the documents to have your identity verified. Once the documents are verified and follow the eligibility criteria, the bank will approve the application.
Must-Have Documents for Home Loan
Below are the documents you must have for the housing loan approval process:
- Identity proof
- Home loan Application form
- Bank account statement – Most banks ask for a statement for the last three-six months
- Passport-size photographs
- A document containing details of the property
- Liability statement and personal asset records
- Signature verification
- Salaried individuals must submit salary slips
- Form 16/IT Returns of the past two financial years
The self-employed professionals must submit the following documents:
- Advance Income Tax payment challan
- IT Returns/Assessment Order copies of the last three years
- Proof of business
List of KYC documents for a home loan
For KYC verification purposes, you will need to submit the following documents:
Photo ID Proof
- Voters ID card
- Driving Licence
- PAN card
- Ration Card
- Electricity Bill
- Employment Letter
- Telephone bill
- PAN card
- Driving Licence
- Bank Passbook
- 10th Class Marksheet
For the residence, age and photo ID proof, you must submit any one of the documents requested.
Can Non-Resident Indians (NRIs) apply for home loans in India?
Yes. NRIs can also apply for home loans in India. However, they must first consult the bank on how much of a home loan they can get. The criteria usually vary from bank to bank. Therefore, it is important to get confirmation and then proceed.
What documents do NRIs need to submit?
The NRIs should submit a list of documents to prove their identity. Moreover, the government may request additional documents as well. Some of the documents that they need to submit to get the home loan approval include the following:
- Documents for their KYC approval
- Salary certificate from the employer in English, including the name (as per passport), passport number, designation, date of joining, and latest salary.
- Last 3 to 6 months’ salary slips, including variable components such as incentives and overtime.
- Latest IT returns (if the applicant files IT returns in the country).
- For self-employed NRIs, business documents like Sponsor Agreement, Trade Licence, Power of Attorney, etc.
- Passport copy displaying the page of residence visa.
- Proof of job by the government of the residing country, such as a work permit, labour contract, etc.
- Property documents with cost estimates from an Indian architect or engineer.
- For salaried NRIs, income documents attested by an embassy official are required if there is no documented proof of salary credit or fund remittance to India.
- Copies of bank statements from overseas for the past six months.
- Last 6 months’ Non-Resident Ordinary/Non-Resident External (NRO/NRE) bank statements.
- If the applicant is unavailable in the country at the time of signing documents, a Power of Attorney should be produced by the individual acting on their behalf.
Property Document List for Home Loan
- Deed of Sale, Sale Agreement, or Share Certificate (original) in the case of a cooperative society.
- Receipts for taxes paid for the certificate of possession, building and land, and certified sketch of the property location from revenue authorities.
- Allotment Letter from Housing Board/Society/Private builder.
- Receipts of advance payments for the flat purchase.
- Certificate of Non-Encumbrance encompassing the last 12 years/30 years.
- Receipt of land tax payment along with the certificate of possession issued by revenue authorities.
- Permission letter from Appropriate Authority.
- Approved building plan (showing floor plan for flat purchase).
- Original No-Objection Certificate (NOC) issued under the ULC Act, 1976.
- Copy of the relative order if agricultural land is being converted.
- NOC from Housing Society/Builder.
- A precise estimate of construction cost.
- Letter from Housing Board/Society/Builder mentioning their bank and account details for instalment remittance.
- Declaration by the loan borrower stipulating the date by which to construct a house (applicable for land plot purchase).
- Report from a lawyer in a standard format.
- A report stating the valuation of the property in a standard format by an empanelled valuer.
- Documents needed for the handover of original property documents post-closure of loan.
- Power of Attorney to get the original property documents.
This comprehensive article list of required documentation will surely help you get your loan application and documents ready for the banks. As a result, the chances of getting approval increase. In case there are discrepancies, the bank might ask you to re-submit the correct documents.
You might be wondering “How much home loan can I get” after sorting all your documents. The amount might vary depending upon various factors, you can consult your neighbourhood bank for the same.