Home loans are financial services where a Housing Finance Company (HFC) such as Indian Overseas Bank offers their financial services such as Indian Overseas Bank Home Loan to provide financial assistance to the person who wants to have their own house. A home loan helps individuals realize the dream of having their place in effortless ways.
Following are the eligibility criteria which are needed to be fulfilled before applying for a home loan-
1. Self-Employed Individuals - The age of the applicant has to be between 18 – 65 years, and the applicant must have experience of 5 years of in their profession
2. For Salaried Professionals - The applicant's age has to be between 18 – 65 years, and the applicant must have been in employment for a minimum of 2 years.
The credit score required in all the cases is 750 and above. A credit score is significant to avail of home loans which we will discuss later on.
Let's look at the essential documents that are needed to apply for a home loan-
Proof of age (Birth certificate or Class 10 mark sheet, etc.), Loan Documents (if any), Proof of identification (PAN card, Voter ID, Passport, etc.), Proof of Address (Voter ID, Copy of passport, utility bills, etc.), Proof of Income (ITR details and Salary slips)
Another critical aspect of a home loan is EMI. EMI is also known as Equated Monthly Installments and is to be paid every month. EMI includes the interest and a part of the principal amount. Sometimes the issue comes when a person can not exactly figure out the amount of EMI that has to be paid by them every month for a specific period. Banks and other financial institutions came up with a very innovative and helpful idea called the Home Loan EMI Calculator. This calculator helps in identifying the exact amount of EMI which is to be paid each month.
The importance of credit score can be understood with the eligibility criteria itself. Banks demand a credit score of 750 and above to approve a home loan application. A good credit score is a must for availing of a home loan. With the help of a home loan, the credit score can also be improved. With timely payments of EMI, the credit score of an individual improves even furthermore. This makes him eligible for accessible credits at discounted rates in the future.
There are two ways of applying for a home loan-
I. Offline mode-
In this mode, the borrower has to visit the bank branch they wish to avail the home loan services from. The applicant has to fill the form and submit the documents to the bank after satisfying the eligibility criteria. The profile and application of the applicant will go under scrutiny. After careful verification by the bank, the person will receive the approval letter from the bank stating that the home loan has been approved. Along with the approval letter, the person will also receive a call from the banks regarding the home loan terms and conditions. Within a few hours, the loan amount is transferred to the applicant's bank account.
II. Online mode-
Online mode is one of the most promoted and preferred modes of applying for a home loan. The person has to visit either the portal, website, or the mobile application of the bank through which they want to avail of home loan services. They will get an option of applying for a home loan, where they will be guided. After submitting the documents online, the application goes for verification, and if approved, the amount of the loan gets transferred to the user's bank account. Through online mode, the applicant can also track the live status of their home loan application.
Conclusion:
Applying for a home loan has been made very easy. Home loan is a financial service that is high in demand due to its affordability and reasonable cost compared to other sorts of loans available in the market.