What is the Procedure for Applying for a Home Loan?

Most of our dreams of buying a home would remain a dream without the support of home loans. Once you find your dream home, you initiate the process of a home loan. Once you choose a house to buy, you are to begin the process of the home loan - a financing tool.

A secure home loan contains several steps & generally takes a minimum of 15 days to get disbursed.


To help you understand the process, we have a brief step by step guide below:

1. Apply for the Loan


Home loan application process


The first step involves applying for the home loan by the aspirant. The application may differ from one financial institution to others.

This application form will require you to give the personal and professional information, details of your financial assets, and so on. Moreover, if you have decided on the property, then the details of the same.

2. Bank assesses the home loan

This step includes checking the loan eligibility; where the lender/ financial institution will have a thorough check of your repayment capacity & the loan eligibility.

Home loan eligibility criteria include:

  1. Income
  2. Age
  3. Nature of Job and Job Stability
  4. No. of dependents
  5. Existing Liabilities
  6. Repayment Capacity
  7. Verification of job
  8. Verification of your residence
  9. Credit score
  10. Credit report


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3. Legal Verification

Once the bank has confirmed that you are eligible for getting a home loan, the lender will then proceed to verify the property you are looking to purchase. A lawyer is sent for a site visit by the lender to have a legal verification.

The lawyer has to thoroughly check the legal documents of the property and confirm that it is free from any legal issues or dispute. Once the lawyer finds that the property is investment-worthy, a legal verification report will be given to the bank.

4. Property Valuation


Property Valuation

Here, the lender will send an expert to the site for the evaluation of the value of the property to confirm the fair market price. The lender takes this step to ensure that the appropriate loan amount is disbursed against the chosen property.

5. Home Loan Sanction

Once the above three steps are successfully completed, the next step is to sanction the home loan. This process indicates that now you are finally ready to sign the home loan agreement papers.

A home loan agreement looks like a booklet that contains all the terms and conditions of a home loan. Once the loan is sanctioned, you will start the registration process of the property in your name.


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6. Property Documents Registration

This process involves registering the property at the office of the sub-registrar in your area. At the time of registration, it is imperative that you pay the registration fee as well as the stamp duty charges to the government.

7. Submit Post-Dated Cheques and Sign Agreement


Sign agreement for home buying process


When signing the loan document, you need to provide original documents & post-dated cheques, and these post-dated cheques have to be for the next 36 months.

8. Loan Disbursement

Now that you have completed the legal procedure successfully, the loan amount will be disbursed via cheque or demand draft to the property seller.

The seller will then be submitting the property papers to the bank. This means the sale deed and the mother deed of the property will now be in the custody of the bank until complete repayment is made.

Congratulations! Its time to celebrate.

Your home loan is disbursed.
The property of your dreams has been registered to your name.
Now move into your new home.


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