Self-employed persons are now able to get housing finance from leading companies in India. This article explains the steps involved in securing a self-employed home loan.
Buying your own house is more a matter of finally deciding to take the plunge, than getting into the nitty-gritties of how to raise the finances for it. Once the decision is made, every other matter falls in place, starting with securing a home loan.
However, self-employed persons might find the process a little tough, mostly because their source of income is not considered to be a ‘stable’ one. Though lenders wish to include them in their roster of customers, a self-employed person with low and erratic income is considered a credit risk. But leading housing finance companies are extending self-employed home loans with easy procedures and good interest rates, provided the applicant satisfies certain eligibility criteria.
These are some steps to follow when applying for a self-employed loan:
* Start by looking for potential lenders. Not all banks and housing finance companies in India offer self-employed home loans, so you should save valuable time by approaching only those who do. Go with a lending institution that has easy application and documentation processes, as well as quick disbursal time.
* Check your loan eligibility. The eligibility criteria for self-employed buyers may differ slightly from those for salaried applicants. Access the lender’s website and check your eligibility online. You must furnish the closest approximation in terms of your annual/monthly income, so that your eligibility may be correctly computed. Most lenders prefer to deal with self-employed applicants that have a regular stream of income and whose business is generating healthy profit annually.
* Collect all the documents required by the lending institution. The lender will furnish a list of required documents to be attached with the loan application. These documents include personal ID proofs (age, permanent residence), income proofs (bank statement for at least six months, profit and loss statement, audit reports, etc.), and property documents (copy of latest sale agreement in current owner’s name).
* Complete the initial formalities – booking amount, stamp duty, registration, etc. The lending institution will only accept a registered sale agreement with your loan application, so do pay the stamp duty and complete the registration process on the house first. The agreement lists the market valuation of the house, and the final figure for which it is being sold to you. After the registered copy of the agreement is in your hands, you can apply for the self-employed loan.
* Apply for the home loan online. You can apply for the self-employed home loan online by attaching two latest photographs, completed application form, self-attested copy of the registered sale agreement, and all other self-attested documents, and send it to the lender. After this, the lender conducts background checks on your income, place of work, current residential address, the property you wish to purchase, etc. After approving the application, you are invited to sign the loan agreement papers, pay the pre-EMI cheque, and take the loan money cheque from the lender’s office.