Owning a home is becoming a very costly affair these days. A large amount is required to finance a house purchase. Though, the buyer will venture into house buying only when he has a significant corpus to substantiate his purchase. Home apart from being a basic necessity of human being is an object of his endeavor.

Buying a home has become easier these days courtesy affordable home loans from Banks and financial institutions. An easy paperwork procedure and sound bank statement ensures a home loan to the borrower. The set of documents required by the financial institute differs from lender to lender. But there are some mandatory papers that every lender will ask for. A short synopsis of documents required for a home loan application is given below to time and effort of the borrower.

Home loan application form

This is the document that records name, address and other personal details of the applicant. If there is more than one applicant for the loan the same requirement is to be fulfilled by co-applicant The photograph of the applicant and those of co-applicants are mandatory too. The application for the home loan is to be submitted with processing fees, thus, it is advisable to the applicant to avoid filling multiple applications, as the accompanying fee is not refundable.

Applicant’s Identity and address proofs

Lenders generally ask for the copy of any one or all of these documents such as PAN card, valid passport, Aadhar card, driving license, and identity card issued by any government department or employer and Voter card for identity and address proofs.

Income Authentication proofs

The lender will always establish the ability of the borrower about his ability to repay the loan. The home loan eligibility of an applicant is determined only on the basis of his income. For salaried persons, lenders generally ask for the Form No 16 and/or a copy of his income tax return with the computation of the total income. The lender may also ask for the applicant’s latest salary slips, to ensure that he is still working with the same employer and that his income has not undergone any negative change.

Self-employed people

For self-employed people, lenders usually ask for the last three years’ income tax returns with the computation of total income. The bank may also demand copies of audited profit and loss statements and balance sheets, for the last three years. In case the accounts are not audited, you may have to get these documents certified by a chartered accountant. For self-employed professionals, the lenders will also insist on proof of educational qualification. In both cases (salaried and self-employed) the lending institution will also ask for copies of the bank statements where your salaries are credited or your business transactions take place, to verify the authenticity of your income.

Documents pertaining to the property

It is not necessary for you to identify the property, before making an application for home loan. Ideally, the loan application should be made before you identify a property. Doing so will help you to sort out any issue pertaining to eligibility, whether it is related to the quantum of the home loan, or any incorrect information related to your credit score or credit history.

Once you have identified the property that you intend to purchase, you will have to submit the documents related to the property. If you are buying a resale house, you will have to provide the copies and originals of all the documents constituting the chain, from the first buyer to your present seller. This will help the lender to establish that the property is not already mortgaged. In case the property is in a cooperative society, you may have to furnish a no-objection certificate from the society.

If you are buying the property from a developer, you will have to provide documents that establish the clearances obtained from the local authorities, the approved building plan, documents about ownership of the land, legal opinion about the title of the land, etc.