Finance and Money Management

Property Loan Document Checklist: A Handy Reference

A property loan offers several benefits to applicants and enables them to obtain funds to meet their financial requirements. However, before applying for a property loan, individuals must know the various documents to be submitted for property loan verification purpose. Here is a property loan document checklist that individuals must go through before applying for a loan.

 

What documents are required for a property loan?

Here is a list of documents individuals must keep handy while applying for a loan against property:

 

Documents required for salaried individuals for property loan:

When salaried applicants want to apply for a property loan, they must submit the following documents:

  • Duly filled out the loan application form
  • Proof of identity, such as an Aadhaar card, PAN card, driver’s licence, passport or voter ID
  • Proof of address, such as utility bill, Aadhaar card or voter ID card
  • Salary slips for the last three months
  • Income tax returns or Form 16 for the last three years
  • Copy of agreement to sell (if executed)
  • Bank statements for the last six months
  • Ownership proof, such as title deed
  • Copy of chain documents of the property (if applicable)
  • Copy of buyer agreement
  • Proof of receipt made to the developer (if applicable)

Documents required for self-employed applicants for property loans:

 

When a self-employed individual wants to apply for a loan against property online, they must submit the following documents:

  • A copy of the application form duly filled out
  • Proof of identity, such as a PAN card or an Aadhaar card
  • Address proof, such as a voter ID card, driver’s licence, Aadhaar card or utility bill
  • Income tax returns for the previous three years
  • Income certificates issued by recognised authorities, like BDO, Tehsildar or SDO
  • Bank statements for the last six months
  • Ownership proof, such as the title deed of the property
  • Payment receipt for the recent municipal tax, water tax or other maintenance taxes
  • Copy of buyer agreement
  • Proof of receipt made to the developer (if applicable)

Documents required for property loan balance transfer

 

Here is a list of documents applicants must submit when availing loan against property balance transfer:

  • Identity proof, such as an Aadhaar card, voter ID or driver’s licence
  • Form 60 or PAN card
  • Proof of income, such as salary slips or income tax returns
  • Proof of business (applicable for self-employed applicants)
  • Bank account statement for the last three months

In addition, individuals must be aware that financial lenders may ask for additional documents depending on the loan application.

 

Who is eligible to apply for a loan against property?

 

Given below are the eligibility criteria for a loan against property:

  • The applicant should be aged between 24 and 65 years (depending on the lender)
  • One needs to be an Indian resident to apply.
  • Only salaried employees and self-employed people can avail the loan. 
  • A minimum CIBIL score of 700 is recommended to get easy approval for this type of loan. 

Moreover, certain financial institutions provide pre-approved offers on their products, like home loans, loans against property, etc., to borrowers. These offers accelerate the loan application process. To check their eligibility, individuals must visit the website of the lending organisation and enter their basic details.

 

How to calculate monthly instalments for a property loan?

 

Applicants must know the procedure to calculate the monthly instalments. It will help them analyse the monthly instalment of loans against property and manage their finances accordingly. In addition, it will enable them to make part payments whenever possible. 

The following is a formula to calculate the Equated Monthly Instalments (EMIs):

EMI = P x R x (1 + R)^N / (1 + R)^N – 1

Where, 

P = principal amount 

R = loan against property interest rates

N = tenor of the loan

However, individuals can use the property loan EMI calculator by visiting the website of a financial organisation to calculate the monthly instalment amount accurately and seamlessly.

Henceforth, knowing the property loan document checklist is crucial for applicants as it will make it easier for them to qualify for the loan amount. Borrowers must also check their property loan eligibility to ensure a seamless application process.

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