Home Loan is offered to individuals
who wish to purchase or construct a house. The property is mortgaged to the lender
as a security till the repayment of the loan. The bank or financial institution
will hold the title or deed to the property till the loan has been paid back with
the interest due for it.
Home Loan is a Secured loan offered
against the security of a house/property which is funded by the bank’s loan, the
property could be a personal property or a commercial one. The Home Loan is a loan
taken by a borrower from the bank issued against the property/security intended
to be bought on the part by the borrower giving the banker a conditional ownership
over the property i.e. if the borrower is failed to pay back the loan, the banker
can retrieve the lent money by selling the property.
Through a Home Loan, one can purchase or construct a new house/apartment; a Home
Improvement loan is offered to those who wish to renovate their houses; a Home Extension
loan is for consumers planning to add extra space to their house such as a new room
or a new wing; a Loan against Property is offered for a individuals seeking loan
against an already existing property; a Land Purchase Loan is provided to consumers
buying land as an investment, maybe to build a house later on and a Balance transfer
loan is basically a home loan to pay off an existing home loan as this enables you
to avail a loan with a lower interest rate.
In the entire process of home loan right from the application to the final disbursement,
the sanction letter from a bank or financial institution holds a lot of importance.
Home loan sanction letter
- A home loan sanction letter is issued by a bank or financial institution to an applicant
who has applied for the loan. The letter is a proof that the applicant is eligible
to avail a certain amount of home loan from its lender (bank or financial institution)
subject to the fulfillment of certain terms and conditions as mentioned by the lender.
- The sanction letter is not offered immediately to an applicant. Before sanctioning
the letter, the bank or FI asks a list of documents to check the credit history
and repayment capacity of the applicant.
Green Parivar Nidhi Ltd.'s Conditions for Home Loan:
- 1.5% interest per month as Compound Interest Calculation,
- 4 Guarantor required on Home Loan, Guarantor should be the member of Green Parivar Nidhi Ltd.
- Gold Loan Available upto 80% of your Home's circle rate on current date,
- Interst have to pay min. 3 Months of your Loan, If Loan wearer Pre-Mature his/her Loan within 3 Month.
For salaried employees, the documents include:
- Passport size photograph of applicant
- Id Proof (Pan card/ passport / driving license)
- Residence proof (Tele Bill / Company Letter / Leave & License Agreement)
- 3 months' salary slips / salary certificates
- 6 months' latest bank statement of salary account
- Form No.16 / ITR (Latest)
- Loan outstanding letter with track record (If you have any existing loan)
- Processing fees payable to the lender
- Qualification certificate the applicant
- Applicant's contribution details such as FD, PPF, recurring deposits,shares, mutual
funds, etc.
- Flat booking allotment letter
What does a sanction letter include:
- The sanction letter from the Nidhi stating the Nidhi readiness to proceed with approval
of the home loan include the following details:
- Total amount of loan sanctioned
- Tenure for repayment of the loan
- Interest that will be applicable on the loan fixed or floating rate
- Actual rate of interest that is applicable on the loan
- Base rate at which the interest is calculated
- EMI and pre-EMI amounts wherever applicable.
- Period of validity of this sanction letter.
- Terms and conditions of the bank for offering the loan.
Please remember that a sanction letter is not a legal
approval of the loan. A home loan borrower still has to submit further documents
and sign the loan agreement before the amount can be disbursed to him. Usually a
sanction letter is valid for six months.
For a Home Loan, the basic registration charges, transfer charges and stamp duty
costs are added to the cost of the home. Some other charges include.
1. Processing charge or booking fee – paid to the lender when you
apply for the loan. It could be fixed or a percentage of the loan amount
2. Pre-payment penalty – if the loan is repaid before the agreed
duration, some lenders may charge a penalty, up to 2% of the amount pre-paid.
3. Miscellaneous costs – there could be a documentation or legal
fee, also known as “application fee”