“Mumbai city being listed as one of the highly priced real estate locations around world and getting a dream home in this town and around is far from reach now a days because of high inflation compared to a middle class earnings, even being working with a top notch IT & Non-IT company. Every other individual opt in for Home loan depending on its individual eligibility, Income proof and sources. Lets looks at some of the listed leading home loan companies, the sanction process, details about Eligibility to get your dream home loan come true in commercial capital city Mumbai. Also request to kindly consider this article as a basic and briefing (personal knowledge only) about what it takes to get a loan here in city..”
Quick Look : [ Process of Getting a Home Loan ], [ Loan Sanction Documents and Eligibility ], [ List of Home Loan Companies ], [ Interest Rates and Loan Charges ], [ 11 Out Of Box Housing Loan Tips ], [ Updates ]
Process of Getting a Home Loan
To keep it simple and precise, Getting a loan for your dream home in any locations is possible in and around Mumbai, like South Mumbai, Western Suburbs, Eastern / Central Suburbs, Navi Mumbai or Far North Suburbs (Thane District) beyond Dahisar like Virar Vasai which is one of the residential hot spots with cheaper home rates compared to other locations in city. One just need to have essential documents for loan sanction process like Income proof, Income Tax proof and other things in place to get things processed faster. If you ask me what if one don’t have all the documents or some required documents are missing ? Will i still get a loan ? and many such questions related. Ill try detailing as much as i know personally in below process, Yet i highly recommend to go through the property purchase checklist and Home buying checklist, which will be of a sure help. Now lets get back to the step by step process of getting money out of the bank for your planned residence. Basic process goes like this :
- Identify your property on which you want to take home loan. Or if already done initial payments to Builder OR First Owner (seller) then get the documents related to that home ready.
- Apply for loan sanctioning process from any Financial or Non Financial companies. Some of the leading listed companies and Banks following RBI norms are HDFC, ICICI, IDBI, AXIS and more, Few leading Non Banking Private firms with comparatively higher rate of Interest are GIC, DHFL etc. The Below section will detail you about the documents required to avail the required loan.
- Get the sanction letter. Based on your financials records the companies may or may not sanction loan. Leading banks are very strict with terms and requirements, Yet private loan platers like GIC and DHFL may consider sanctioning based on personal meeting and talks.
- Pay the stamp duty and get the residential property registered with legal authorities locally where you stay.
- In the required / requested period of time submit the registered documents with required / bank requested letters, payment receipts, demand letter from Builder to loanwala firm.
- Upon documents and property verification, Best and faster if the property is from a ‘A’ listed reputed builder the final loan disbursement happens in the name of the seller.
Loan Sanction Documents and Eligibility
For salaried person : It makes life easy to get a loan sanctioned if you are salaried / doing a job in one of the known and leading companies (IT or NON-IT). Eligibility is being a Indian citizen with all the required documents, proof with age above 18 years. Any Salaried or Self employed person is eligible for home loan. Their are very few things you need to provide to the Banks or any Financial company for same. So what all basic documents are required for a salaried in Mumbai to get loan sanctioned ? Below are same :
- Salary Slip : Last 6 months salary slip.
- Bank Statements : Last 1 year statements of all the banks that you operate your account. Primary and ideally the bank which has your salary account.
- PAN Card Copy : Zerox of your Permanent Account Number card.
- IT Filings : Last 2 to 3 years of your Income Tax Filings.
- Filling the loan sanction / application document given by Bank or Financial institute from where you applying.
- Passport size photographs.
- Residence proof : Your bank account will detail you current residence proof, either if you are staying with father owned or something similar situation. Bank may ask you more documents in case you are currently staying in a rented home.
- Photo ID proof : Driving License, Passport are two of the legal document which will help in processing.
- Processing fees.
- Get all the financial document attested ‘Certified True Copy’ by your CA (Charted Accountant).
In many cases, it takes about a week to get home loan sanctioned letter.
If i have missed anything, Please help me add with your comments at end of this article.
For Self Employed / Business : Compared to a salaried, their is more to your work in the process of getting a sanction letter in hand with the documents if you are a self Employed (Proprietor of Business) or a Director of a private ltd firm. Process of getting sanction takes more days too as many other verification activities are done by bank personals to confirm the eligibility and authenticity of the person applying for home loan. A special process called ‘CIVIL’ is taken more seriously here which details about your ’till date’ financial records like any defaults, cheque bounces, non payments of any other loans etc. Yet below is a overview of sanction process and documents required.
Companies last 3 years balance Sheet and Profit and Loss, Audit and other documents, Along with Income Tax Filings ‘Personal IT filings’ of the person applying for loan (Proprietor or Director) or any one who owns the firm.
- PAN card.
- Passport size Photographs.
- Residential Proof as per bank records.
- Photo ID proof.
- Payment Receipts (If any payments already done to Builder or Previous Home Owner Seller).
- MOA (Memorandum of Article) for Private Limited Organization. Or documents related to proprietary firm.
- Get all the financial document attested ‘Certified True Copy’ by your CA (Charted Accountant).
It takes about 15 to 20 days if you are applying through leading companies like HDFC Home finance etc.
List of Home Loan Companies
This type of loans are highly in demand and mostly every other bank provides with the service. Apart from leading banks, many other private companies lends long term loans too. List of such Private and Government Banks along with those private organization who provides home loans are listed below :
- HDFC Home Loan.
- ICICI Home Loan.
- AXIS Bank Home Loan.
- SBI (State Bank Of India) Loans (Government Bank).
- PNB Housing Finance.
- Bank of India Loan Section.
- Union Bank Loan.
- Dena Bank.
- Canara bank home loan.
- Bank Of Maharashtra.
- UCO Bank.
- Corporation Bank.
- Central Bank of India (Government Bank).
- Bank Of Baroda Loan Section.
- Federal Bank.
- Indian Bank.
- ING Vysya.
- Kotak Bank.
- HSBC Bank.
- Deutsche Bank.
- Standard Chartered.
- Oriental Bank of Commerce.
- Dhanalakshmi Bank.
- Vijaya Bank.
- Indian Overseas Bank.
- State Bank of Travancore.
- Development Credit Bank.
- DHFL (Private, Non Banking).
- GIC (Private, Non Banking).
- Tata capital Housing Finance ltd (Non Banking).
- LIC Housing Finance (Non Banking, primarily into Insurance).
- First Blue Home Finance (Non Banking).
- India Bulls (Private, Non Banking)
See complete list of Leading banks.
Interest Rates and Loan Charges
As a home buyer, some very common questions that rise up in mind are What is the current home loan interest rate ? And which bank offer lowest interest rate in Mumbai, right ?. This is very common and although this page will detail you about some idea on where and which company to try first, second and which should be your last options when it comes to best cheap home loan rates. We here will not update daily rates, Yet the best is to understand that as per date of writing this article, some banks like SBI and Companies like LIC offer the lowest interest rates for housing loan. Next comes the big market players like HDFC and ICICI with competitive rates. And your third and last option when it comes to cheap rates should be GIC and DHFL as they always have one or more percent more then others. That also makes it obvious that the paper work and run to and from bank for SBI and LIC will be more compared to later. A good page to refer latest interest rates of HDFC, ICICI, SBI, DHFL, GIC and other institutes i found is here.
11 Out Of Box Housing Loan Tips
- What after loan ? Possibly a car or some interiors in your new home. If your answer is yes and if the general Black and White payment process and transactions allow and makes you eligible to pull out some extra couple of lakhs for tenure of 15 to 20 years of home loan, WHY NOT ? The interest rates will be less compared to luxury car loan or compared to personal loan you may pull out after a year or so for your interiors. Think on it, But plan your finance well before.
- Do you know, You can avail a top up on your existing home loan (if any) after few years of your primary loan applied ? Yes, you can as the value of the loaned property increases with time and you can avail a hassle free top up on your existing home on current market rates. It’s good in case you looking for another weekend home or any emergency too.
- Do not delay the Stamp duty and registration process, as with few months more spent / delayed, the cost of property generally increased and the registration amount, stamp duty and service tax along with the VAT increases too. Don’t wait.
- Keep you civil records clean. Transactions like cheque bounces or non payment of any previous loan may bring some disturbance in current loan process. Once you give your PAN card details, all the civil records along with your credit cards usage and payment records are opened which can help or create hassles.
- Pre-payment of lumsum amount may help you save interests. As per RBI rules their is no pre-payment charges on payment you do on you existing loan. Entire amount is directly deducted directly from principle amount and your life gets easy.
- In hurry if you have fetched loan from some private loan companies on higher rate of interest, Remember a new process of ‘loan transfer’ can help you save few hundred to thousands of rupees every month. Get your loan transferred from high interest to low interest bank / firm like SBI. Why pay more huh ?
- Do not do your investments hastily in the financial year you took up your home loan. WHY ? because the stamp duty and registration amount which you payed are considered for tax rebate to save your tax for that particular year along with your monthly EMI, So plan well.
- Check twice when it comes to dealing with franchises who may charge 1% to 2% extra under table to get things done. Keep any such dealing for worst case scenario or better don’t fall in trap, as they may be fraud.
- Few financial loan givers also do a pre-approved property verification check with minor extra charges, This helps you get confirmed about dealing / buying that property or not. Sanction of loan doesn’t mean any property you selected will be approved for disbursement. This will also help saving you falling in trap some non-reputed builders with fraudulent illegal work and lucrative cheap deals.
- Make things clear about PRE-EMI. This is a EMI you pay when you take sanctioned loan in parts as per requested by your selling party / builder, the actual EMI starts later. Try not to get into trap.
- Read the loan documents properly. Those stars * and ** are most important to be noted before signing on legal documents.
Have more tip or have i missed any important point, which i can as i am not a professional loan guy, Please comment below to add tips and more and KINDLY SHARE IF IT HELPED.