If you choose a home loan lender without adequate knowledge, you might have to bear the brunt of hidden charges. Make sure the excitement to buy a house or the persuasive agent must not affect your decision. Here is a list of important factors you must consider to understand the process of seeking loan better.
1. Rely on a well-known lender
When it comes to granting House Loans, every financial institution has its own method of the screening process. While some process it quickly, others may take their own time. Just make sure you choose a reliable lender whose terms and conditions fit as per your requirements.
2. Loan approval process
There are a few HFCs that take a couple of weeks to process your loan application while others make take a couple of months to do the same. The processing fees of financial institutions may also differ due to many different reasons. Every HFC has its pros and cons; you just need to pick the one that suits your requisites.
Only after you submit your application form and the necessary documents, your eligibility for house loan will be decided. The lender may ask for your bank statement showcasing your last six months transactions, salary slip, last 3 years’ form 16, PAN card copy and address & age proof. The lender will do due diligence after you submit the documents and check your credit history.
4. Borrowing costs
When seeking a loan, a few expenses are incurred by the borrower. These includes service tax, processing fee, franking charges applicable for registering the loan document and rate of interest that could either be floating or fixed. Know about all these charges before signing your loan agreement. Look if the lender has charged any other fees from you. If yes, clarify the details with him.
5. Loan repayment
Before you sign the loan agreement, read the entire loan document carefully to understand the terms and conditions. Also, read the settlement and foreclosure clauses. These are some of the areas where borrowers feel that they are being overcharged.
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It is important to weigh all these options properly before you choose your house loan lender. Thorough research and detailed understanding of the borrowing process before signing the dotted line will certainly make your loan repayment course a peaceful one.
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