Own house is the dream of every person.

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 For a middle class person, it is considered as a life time
achievement as it requires quite a huge amount of money.

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 Banks play a pivotal role in fulfilling this basic need.

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 The products they offer and the services they provide are
of immense use to people who intend to have their own
house.

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 For a safe and beneficial home loan,
proper awareness over the products,
policies, terms and conditions of the bank
is most important as ignorance may result
in more payments to the bank in terms of
principal and interest components.

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 With proper planning and a right approach you can avail
an easy and beneficial home loan to fulfill your dream of
possessing a house.

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 The following ten-step plan will
certainly help you in accomplishing
the task:

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 Know about the products:

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 Prior to going for a home loan learn about the products
that various banks offer; also know about their terms and
conditions. After careful study select a product that suits
best to your financial status.

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 Know about the rate of Interest:

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 This is the most important factor about
which you have to think more than once
prior to going for a home loan.

Plan carefully whether you want to go

for a fixed or a floating interest rate
plan.

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 Have a good clarity from the bank so as to avoid
disappointment in the future.

Also if you go for a fixed interest rate plan, make yourself

clear if it is fixed for the whole tenure or subjected to
changes as per changes in money market conditions.

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 Know about the repayment Period:

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 Choose an apt repayment schedule as per your financial
status and possible future growth.
Usually banks offer a tenure ranging from 1 to 25 years
for home loans, and 1 to 15 years for mortgage loans.

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 So keeping in mind of your income levels and liabilities
choose your own plan for flexible repayments to avoid
future disappointments.

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Know about the eligibility criteria:

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 Banks usually take fixed and variable income sources
into consideration to approve a home loan.
They reserve the right to sanction or reject the application
if they find any information misleading.

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 So it is advisable to provide useful applicable information
only.
Once you receive the sanction letter please read it
carefully for Interest rate revisions, Sanction conditions,
Pre-closure charges and terms and conditions of the bank
before signing it.

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 Legal documents and scrutiny:

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 You must submit all the legal documents pertaining to the
property you intend to buy to the bank. So you must
collect all the link documents, lay out and plan, and
ownership documents from the vendor.

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 It is to be taken care that if there is any legal dispute on
the property then the proceeding and judgment copies are
also required.
You must verify the legality of the property with a legal
advisor prior to buying it.

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 Banks will not hold any responsibility if any legal issue
that may arise in future, and the customer has to continue
to repay the loan.
Remember that bank will not take any responsibility
about the legality of the property.

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 Technical evaluation:

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 Banks evaluate the value of the property based on the
standards set by their panel members.
You should take all security measures against the
deviations both horizontal and vertical which will affect
loan processing as well as future transactions.

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 If the property has deviations, you should ask the vendor
for the copies of regularization.

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 The property should have the necessary permissions or
documents to regularize the deviations according to
Building regularization scheme (BRS).

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 Also, check all the details like plot area, sanction area,
plot number and the government approved plan valid
dates before going for a processing.

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 Home Loan Agreement:

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 Please read the document carefully before signing it as it
is a long term contract between the customer and the
bank.
Once you sign the document it can't be altered or
modified until you repay the loan in all respects.

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 Registration:

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 Home Loan processing ends with the registration of your
dream property.
Take care that the sale deed clearly states about your
complete ownership of the property.

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 Remember that even a small mistake can lead to bigger
problems.
So read the sale deed documents carefully prior to
submitting for the registration process.

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 The vendee should collect all the link documents, Plan
copies and tax Paid receipts from the vendor at the time of
registration only.

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 Processing, pre-payment
and foreclosure charges:

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 The customers have to pay the processing charges to the
bank for the loan availed.
The customer should know about the additional charges
which bank will make in cases of pre payments and
foreclosures.

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 A customer needs to pay a max of 4 % of the outstanding
principle along with service tax towards the foreclosure
charges of the loan.

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 Tax exemption:

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 In addition to giving the joy of possessing a house, home
loan provides the facility of Tax exemption on the
principal and interest paid over a financial period.

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 A customer can claim tax exemption for the amount paid
as stamp duty during the registration process. The Bank
will provide you with the provisional certificates to claim
the tax exemption from the income Tax department.

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