The Ultimate Handbook: Mastering the Home Loan Process in India


Lots of Indians benefit from home loan procedures to purchase the homes and property of their dreams. But not everyone is familiar with the correct home loan process in India. Several home loan applications are being turned down one after another, which puts buyers in a precarious position where they may quit or be unable to repay the loan. Here is a complete guide to understanding the finest home loan application procedures in India.

HFCs, or housing finance companies, provide home loans to purchasers in return for EMIs. Until the customer pays the whole amount, the house or other property that they acquire serves as collateral. Before the sale, thorough verification is done for the property and the buyer. The buyer’s financing is also verified, along with everything else. Simply put, because the Indian home loan application procedure is intricate, it must be properly comprehended. However, here are some tips on the home loan process in India from ‘Mr. Subhash Goel’, the founder of Goel Ganga Development.

How Do Home Loans Work in India?


Here are some tips on house loans in India and how they work:
  • The assumption made by banks is that the buyer’s income will cover 50% of the loan’s payments. Thus, a buyer may qualify for more loans if their income is higher.
  • The purchaser is required to put down 10%–20% of the purchase price, depending on the location. The cost of registration, paying stamp duty, and transferring property are all included in the total sum.
  • It is up to the buyer to let the lender know what kind of investment they are interested in. This is due to the fact that the investment is reliant on real estate values, which can either be fixed or fluctuating.
  • Also included in the mortgage are other fees. Registration fees, technical assessments, charges for inspection, legal paperwork, and other fees are among these extra costs. These extra fees could even be waived by some lenders.
  • Lenders provide borrowers or purchasers with a statement during the first year of the loan outlining the principle and interest payments that are expected from them.
  • In the last year of the loan, the borrowers’ real principle and interest payments are shown on the lenders’ providers’ statements. For tax purposes, this information is used.
  • A higher prepayment may result in more savings on your mortgage payments. A partial prepayment may lower both the total principal owed and the amount of interest that must be paid.
  • Prior to the start of a loan’s duration, it may be pre-closed. Even if interest rates fluctuate, there are no fees assessed. Furthermore, if interest rates are set, fees can be incurred.
Steps for applying for a home loan:



A formal loan application is submitted to the bank. There are number of documents required for home loan application. Such as identification proof, Proof of address, proof of banks, proof of work, proof of age, and others.

Processing fees:

The bank generates these non-refundable loan processing costs. These costs also include GST.


The procedure of verification follows loan application and loan fee processing. This procedure determines a borrower’s loan eligibility. The residence and place of employment are visited by Bank representatives for verification. Buyers’ credit histories are also examined. There are ways through which you can get home loan even if you have bad or low CIBIL Score. 


In India, verification is crucial to the loan application procedure. This application may be approved or rejected depending on your capacity to repay the loan.

Offer letter:

The bank provides an offer letter with information such as loan periods, repayment options, interest rates that apply, sanctioned sums, special interest schemes, rates of interest, and terms and conditions. The bank receives a signed copy of the offer letter.

Property verification:

All property documentation may be requested during the property verification process that takes place before the bank issues the loan. The bank inspects the property and evaluates things like ownership, building quality, and other things.

Home loan:

With the successful completion of all of the above steps, the process of obtaining a mortgage loan starts. The buyer must sign a loan agreement in order for the house loan disbursal procedure to proceed. The bank will decide the loan amount based on the factors mentioned above. This is how a home loan works.


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