One of the most common reasons for home loan application rejections is incomplete documents. Lenders often complain that home loan borrowers submit incomplete or insufficient documents. It unnecessarily lengthens the loan process and sometimes leads to application rejections. Documentation is one of the vital steps of a home loan application. Lenders gather all your details from the documents you submit and use them to decide the loan approval. Therefore, if you are planning to apply for home loan, ensure that your documents are in order and complete.
You will need the following documents to avail a home loan.
No home loan application is ever approved without accurate property documents. Lenders require property documents to evaluate your property value and to check the ownership of the property. You would need to furnish documents like sales deed, a copy of building plan, copy of layout, estimated cost of construction, tax paid receipts, encumbrance certificate etc.
- Sales deed
A sales deed is a document confirming the transfer of the property from the seller to the buyer. It contains all the details of the property.
- No objection certificate
There are multiple No objection certificates you need to take while buying a house. You would mandatorily need to take a NOC from the government, authorities like municipality, society, etc., for a home loan. A NOC certifies the concerned authorities have no objection to you purchasing or building your house.
- Occupation certificate
The occupancy certificate certifies that the house is safe and can be occupied for residential purposes. You would need to take an occupancy certificate from the sanitation, water and electricity department.
- Non-encumbrance certificate
Lenders assure that the property for which they lend loans is free from any ownership disputes. You would therefore need to take a non-encumbrance certificate from the sub-registrar. It will certify that the property has no pending dues or legal disputes.
Lenders would also ask for your income and business documents for a home loan. You would need to submit salary slips for the last 3 months, Form 16 and the last six months bank statement if you are a salaried person. Similarly, if you are a self-employed applicant, you would need to submit IT returns, the profit and loss & balance sheet of the business for the last three years.
Know Your Customers (KYC) Documents
Along with the above-mentioned documents, do not forget to furnish adequate identity and address proof to support the application. You can submit any one of the following for the identity and address proof-valid voter ID, passport, Aadhar card, utility bills, PAN card, driving license.
These documents are needed for the record of the transactions. You would be asked to display the original documents and submit their photocopies.
Though this is a standard list of documents that the lenders ask for while approving your home loan, you must check with the lender for any additional requirements. Moreover, ensure that the documents required for home loan should be accurate and updated. They should contain the relevant information and should be furnished at the right time.