A shelter is a prized possession that every individual wishes to own. It’s a dream of many to have a personal space they can call home. To turn the dream into reality, you require credit and that can be obtained via a home loan. While there are multiple options available today, housing loan eligibility is an important aspect for any option you choose. Why? Because it’s imperative for a lender to have knowledge about your repayment ability. Credit debts, delays in payments and more can significantly impact your ability to get a loan. Therefore, there are multiple things you need to consider before applying for a home loan.
Here are 4 essential things that you can’t afford to forget before you go for a home loan:
1. The Credit Score
Your credit score is basically a ticket to avail of a simple home loan process. It’s like a report card of your credit that illustrates how good your record has been with making payments of EMIs and credit dues. It’s your credit history that compiles each borrowing from various financial institutions like NBFCs, Banks, HFCs, etc.
Whenever an enquiry is made, a reputable credit bureau prepares your credit report that encompasses all the previous borrowings and shares it with the selected lender. The math is simple here, the higher the credit, the higher the chances for you to get the loan. A good credit score also makes a good impression which might also get you the best interest rate on a home loan. Therefore, you must check your credit score at least 6 months or 12 months prior to purchasing a home loan.
2.The Budget, EMI and Down Payment
There have been many instances where people have blindly taken a home loan without considering the expenses which ultimately made repayment extremely difficult. It’s important to know your budget, how much you are willing to pay for the down payment and how much loan amount you require. EMI is yet another important factor to consider as it greatly influences the tenure of the loan.
3.The Documents Required
Before applying for a home loan, you must have knowledge about the necessary documents required and have them at your disposal before approaching a home loan finance company or a bank. While the document requirements may vary from one bank to the other, there are some basic documents you must have. They are as follows:
- PAN Card
- Aadhar Card
- Form 16 or Income Tax Returns of 2-3 years
- 6-12 months Bank Statement, etc
4.Select the Right Lender
You must avoid applying to multiple lenders at once as it can negatively impact your credit score. This shouldn’t stop you from comparing your options. Opt for lenders that have pre-approved the property that you need as that can considerably lower the approval time. Select one or two lenders that match your requirements and know their eligibility criteria before applying.
Getting a home is a huge decision, make sure to do it the right way by selecting a credible home finance company like IFL that ensures to offer transparent and hassle-free home loan services.