Once you think of buying yourself a house and go looking for that perfect dream house, only to find out that you are unable to finance your new house at the moment. And you realize that you really want that new house. You might at this point consider the option of taking a bridge loan.
A bridge loan is the scenario wherein if you have enough equity in your present home, the bridge loan will allow you to avail of a loan so you can make a down payment and buy your new house. The only catch here is that the interest rates on the bridge loan are much higher than those on the home loans. Another thing to consider is that it is a short-term loan, and there are also costs and fees involved. Therefore you might do better for yourself if you consider applying for a home loan. The procedure is simple and of course you have to meet a certain eligibility criteria. Once you have identified the house that you want to purchase, you can go ahead and approach any financial institution dealing or disbursing home loans.
Though applying for a home loan may seem like a very difficult task, it definitely need not be that way. Given below are some Home Loan Basic that you need to know before you go about applying.
The first step to getting a home loan involves filling up the application form of the chosen financial institution along with the required documents. Do remember that you will need to pay a one time processing fee at this stage.
You will also require some important documents to get through with the loan processing stage. In case you are an employed individual, you will require verification of your employment form, you latest salary slip/salary certificate which outlines all deductions for atleast the last 6 months, Form 16 from your employer for the last 3 years.
In case you are a self employed individual, you will need a Balance sheet and profit and loss account of the business/profession along with copies of individual income tax returns for the past 3 years as certified by a CA. You will also need a note, which gives the information on the nature of the business, year of establishment, present bankers, form of organization, clients, suppliers etc. And of course you will need a statement proving your net worth as an applicant.
Once you are past this stage you will need to submit the property documents. After getting the approval from the financial institution where you plan to borrow, the loan will be disbursed to you