Most Indians who aspire to buy a home rely on getting a home loan to meet the cost of buying a home. However, since home loan involves a large sum, the lenders sanction the application only after careful consideration. This ensures that there are no bad debts and the borrowers repay the amount diligently on time.
So, while you submit your application, even a small mistake can lead to rejection, which in turn can affect your credibility and credit score. To help you avoid these hassles, we list down a few vital things that will help you get your home loan approved.
Apply for a home loan
Applying for a joint home loan can significantly improve the chances of approval. When you apply for a home loan online with another earning member in your family, the lender will consider both your income for determining the eligibility.
Also, when there are more than one individual taking the repayment responsibility, the chances of repayment is higher. Thus, from a lender’s perspective approving your loan has minimal risk and you can get your loan sanctioned.
Another benefit of applying for a joint home loan is that you can be eligible for getting a higher loan amount and both the applicants can enjoy tax benefits individually. Some lenders even offer a concession on the interest if the co-applicant is a woman.
Choose a loan with longer tenure
Another effective way to improve your chance of home loan approval is to apply for a loan with a longer repayment. This helps you lower the EMI and make it more affordable. Also, you need not compromise on your other financial goals to repay the EMI.
Lenders generally prefer home loan applications with a longer term for two reasons – One, since the EMI is affordable, the chances of default is minimal. And, two, longer loan term higher interest payout.
Pay a higher down payment
When you apply for a home loan, the lenders generally pay a maximum of 80% of the property’s value. You must pay the balance amount from your pocket. This is known as down payment and it is an inherent part of the home loan process.
However, you can voluntarily choose to pay a higher down payment. Lenders will see this a blessing as it reflects your strong financial standing and you can earn their trust. Thus, it will speed up the loan approval process.
Choose the lender wisely
One of the easiest ways to get your home loan approved without any hassles is to choose the lender wisely. If you have an existing relationship with any lender with whom you have previously borrowed or have another loan like a car or personal loan and if you have maintained a good repayment history, they are more likely to approve your application faster.
Choose a reputed property developer
When you apply for a home loan, the lenders usually prefer applicants that wish to buy a home from a reputed and reliable property developer. When you choose a credible builder, chances are high that the project will be completed on time and there are no legal issues.
Also, most lenders have tie-ups with top builders and they pre-approve their projects. So, choosing a lender-approved property can significantly improve your chances of home loan approval.
Buying a home is more than just financial investment, it also involves several emotions. It gives a sense of pride and security. So ensure that you do everything right by following the above tips and get your loan approved.