How to apply for Home Loans

Buying a house is one of the biggest dreams come true for most people and an extravagant
affair altogether. A home loan can be opted to buy a new house/flat or a plot of land where
the house can be constructed and even for renovation, extension, and repairs to an existing
house.

The most common type of home loan availed to purchase a house.

Factors considered for home loans

Banks have a list of eligibility criteria for home loans. The first thing banks look at is one’s
credit history to understand their repayment habits. Some other important factors taken into
account are as follows:

 Age

 Employment Type

 Minimum Annual Salary

 Collateral Security

 Margin Requirements

 Assets, liabilities, stability, and continuity of occupation

 Residency status (Resident Indian/ Non-Resident Indian)

Procedure for applying home loan

Here are the steps of the housing loan procedure.

 Step 1 - Complete the Application Form: Completing the application form is the first step of the home loan
procedure. Fill in the personal information as well as information about earnings, work opportunities, current
assets, property, schooling, and so on in the form. The home loan application form is available both online and
offline.
 Step 2 - Attach the Required Documents: The documents required to b attached with the home loan
application form are:
1. Identity card (PAN Card, Aadhaar Card, Passport, Driving License, etc.)
2. Address proof (Aadhaar Card, Passport, Driving License, Utility Bills, etc.)
3. Age validation (Birth certificate, 10th certificate, Aadhaar Card, PAN Card, Passport, etc.)
4. Evidence of academic qualifications
5. Income proof (Bank statements, ITR, etc.)
6. Business evidence (Balance sheet, Profit & loss statements, Business license, Proof of business address,
etc.)
7. Documents about the period of mortgaged property ( an approved copy of the building plan, a letter of
consent from the society/builder, and an estimate of the cost of construction)
 Step 3 - Pay the Processing Fees: The lender may request a processing fee after you submit the home loan
application form and all supporting documents. The processing fee for a home loan is non-refundable and
varies between lenders. It typically ranges between 0.25% and 1.0% of the loan amount requested. In addition,
many lenders do not charge processing fees. Lenders charge a processing fee to start the home loan procedure
and keep the applicant's loan account active.
 Step 4 - Document Verification: The lender/ banker will verify the submitted documents and other details.
Bank representatives may even visit applicant’s home or contact his organization to validate the information
provided in the home loan application. The lender/ banker will also request for applicant’s credit score and
credit report from one or more credit bureaus during the checks. The process will be expedited if all of the
documents and information provided are in order and correct.
 Step 5 - Sanction Letter: A sanction letter hall be received after finally passing the preceding steps, which
will typically include the following information:
1. Sanctioned loan amount
2. Applicable interest rate
3. Interest rate type – fixed or variable
4. Loan term
5. Repayment method
6. Special plan (if applicable)
7. Terms and conditions of the home loan
8. Mortgage policies
9. Other details, such as the home loan policies, may also be included in the letter

After receiving the letter, sign and return the acceptance copy to the lender. The acceptance copy
is a duplicate of the sanction letter kept by lending institutions/ bank for record-keeping.

 Step 6 - Verification of the Property and a Legal Check: The bank will verify the property collateralised
before disbursing the loan. Original copies of the property title, NOC, encumbrance certificate, and any other
documents requested by the lender/banker will be required. The property will be subjected to a legal review to
ensure that the title is clear and that no disputes exist. The bank will also conduct a specialized valuation of
applicant’s property. In the scenario of an under-construction property, the bank will examine the property's
location, construction stage, quality, and progress, among other things. If the property is ready to sell or resell,
the bank considers its age, ownership, construction quality, maintenance, location, and legal clearances.
 Step 7 - Disbursement of the Home Loan: After the completion of all of the above steps the final agreement
from the lender is received. Subsequently, the home loan will be disbursed according to the terms that were
mutually agreed upon.
How to apply for education loan

Studying in India or abroad is very difficult in financial terms even if one has got the parental and
scholarship support. For those without access to either, student loans prove to be the saviour.
Easily available and accessible student loans bring about a much-needed parity among those
with privilege and those without. With study loans, students get an opportunity to pursue their
education without regard to their financial situation.

The education loan application process is perhaps the easiest process among all. Gathering the
information about banks’ terms and conditions is a more painstaking task, compared to the
application part. With the latest interventions of online platforms for student loan application,
students now don’t need to visit the bank branch to get their loan sanctioned.
Still, some students choose to apply for education loans by a direct visit to the bank.
Most students pursuing education abroad in need of financial assistance find this practice less
rewarding. Considering the growing demand for online application, more banking institutions are
introducing online features for the benefit of students. In either case (online/offline application)
students are suggested to adhere to some basic principles for best results.
Features and conditions to consider for education loans
 Study loan amount: minimum limits and upper limits, if sufficient enough to pay for the
complete education
 Student loan interest rates: floating MCLR rates based changes, institution/course
based relaxations in interest rates
 Student loan eligibility: difference between financial eligibility and academic eligibility,
requirement of co-applicants, age limits
 Expenses covered: only tuition fees and living expenses covered or additional study
tools and equipment expenses, other academic expenses like building fees, caution
money covered as well?
 Processing charges: collateral inspection charges, deed-writing charges, pre-payment
charges, margin payment
 Study loan discount and subsidies: subsidy for girl students, government schemes,
private banking schemes

How to apply for education loan: Offline process

1. After gathering the complete information about the education loan calculation, collect the
necessary documents required for application.
2. Visit the nearest branch of the selected bank.
3. Ask for a student loan application form and fill all personal, academic and financial details.
4. Confirm all the terms and conditions from bank official/relationship agent/loan officer.
5. Complete the loan application process and get a formal student loan agreement.

How to apply for education loan through official bank website ie Online?

1. Visit the selected bank’s official website.

2. Find the education loan product page.
3. Fill the application-cum-consent form by providing your personal and contact details.
 4. Provide complete academic and financial details on callback received from the bank.
5. Opt for doorstep service of study loan or visit the bank to complete the loan sanction
process.

How to apply for education loan from government vidyalakshmi portal?

1. Visit the Vidyalakshmi portal’s official website.

2. Register with your contact details and verify registration from email.
3. Complete the Common Education Loan Application Form (CELAF).
4. Upload necessary collateral, academic, financial and identification (KYC) documents.
5. Select the finalised bank study loan option from the list of schemes available.
6. Apply for the scheme and confirm your application.
7. Check loan application status regularly.
8. Confirm all details as mentioned in CELAF on bank confirmation call.

How to apply for education loan: Subsidy application

 Student loan subsidies are mostly provided by the government but applicants should also
check for internal bank schemes for subsidies.
 There are several subsidy schemes for girl children and students with special abilities.
 Study loan interest rate subsidy is not automatically enrolled with your loan even if you pass
the eligibility criteria.
 Students need to apply for subsidy separately, apart from student loan application form.
 Applicants would be required to submit family income proof and caste/category certificates
for such subsidies.
How to apply for Personal Loan
A Personal Loan is an unsecured loan that can help you meet your current financial needs. The loan
does not require you to pledge any security or collateral and is available with minimum documentation.
The lump sum from the personal loan can be used to fulfil expenses, such as home renovations,
marriage expenses, medical emergencies, funeral costs, etc. You can also use a Personal Loan to
consolidate different debts or ease a liquidity crunch.

Personal Loan can be used for one or more of the following purposes:

1. Buy new electronic appliances: Money from personal loan can be used for buying new electronic
equipment, such as refrigerator, washing machine, TV, AC, etc.

2. Upgrade to the latest smartphone: As consumers become more upwardly mobile, they prefer to
have the latest smartphones in their hand. Hence, consumers can avail of a personal loan to fulfil this
need / desire.

3. Sponsor wedding expenses: In India, weddings are one of the heftiest financial investments. With
each year, weddings are getting costlier, specifically Indian weddings are great pomp and show. Personal
loan can be used for financing wedding expenses.

4. Meet medical emergencies: Medical emergencies like an accident, critical ailment, serious injury,
etc., often come unannounced. In such situations, financial support from a personal loan is of utmost
benefit.

5. Fulfill higher education expenses: Education, in India or abroad, has become highly expensive.
Parents can take a personal loan to cover the higher education costs of their children.

6. Accomplish travel goals: People can take personal loan to fulfill their dream of travel.

Documents required for Personal Loan

Here is the list of documents needed to present when availing of a personal loan:

 Identity Proof like PAN Card or Aadhar Card

 Address Proof like Aadhar card, Electricity bill or rent agreement or Indian passport

 Income proof (Latest monthly salary slip from the current employer)

 Bank account statement (Original bank statement for the latest three months)
Process

Step 1: Determine loan amount requirement

Decide the purpose and amount of loan needed.

Step 2: Check loan eligibility

After determining the loan requirement, check the eligibility criteria. You can visit the bank branch or these days
Banks provide Personal Loan Eligibility Calculator online on their websites also.

Step 3: Calculate monthly instalments

Use an online EMI tool to calculate your approximate loan repayments every month. The applicant can modify the
interest rate and tenure to match the monthly income,

Step 4: Approach the bank

Fill the application form visiting the bank branch or on bank’s website fill online application.

Step 5: Submit documents

submit the required documents for a Personal Loan.
Commercial Loan
A commercial loan is a form of credit that is extended to support business activity.
Commercial loans are granted to a variety of business entities, usually to assist with short-
term funding needs for operational costs or for the purchase of equipment to facilitate the
operating process. Examples include operating lines of credit and term loans for property,
plant and equipment (PP&E).

Process:

I. Decide the purpose of availing loan: The applicant should decide upon for what
purpose the commercial loan is needed. The loans are available for various need of
business like

• MSME & SME loan –MSME and SME loan is a type of business loan specially designed
to fund operations of any micro, small, or medium-sized enterprises.

• Working Capital loan –Working capital loan is a type of business loan taken to finance
everyday operations in a company, especially when the liquidity is inadequate. You can
use a working capital loan to settle expenses like payroll, rent, operational costs, or inject
cash into your business during off-seasons.

• Machinery loan –Machinery loans help enterprises obtain funds for investing specifically in
new equipment or machinery to improve their production process and enhance
productivity.

• Invoice financing –Invoice financing is useful if there is a significant time gap between
making a sale and receiving its payment. Most lenders will easily finance around 80% of
the amount receivable and take a percentage of the invoice amount as a fee.

• Start-up loan –As the name suggests, a start-up loan is specifically for new business
ventures. It provides an influx of cash to start-ups during their initial years so they can
easily meet their financial obligations.

II. Prepare documents required: Following documents may be asked by the bank

o Correctly filled application form

o A detailed business plan which lucidly describes your firm’s purpose and objectives,
past performance reports, and how you wish to use the loan amount.
 o Up to the last six months of company bank statements
o KYC documents of the company (PAN card, Ownership papers)
o KYC documents of the business owner (CIBIL score, PAN number)
o Income tax returns for the last two years
o Audited balance sheet for the previous two years

III. Calculate business loan calculator to know the EMIs to be paid for the loan
amount:
The applicant should know about the right amount of loan to be borrowed based on his re-
paying capacity. Many banks today host online business loan EMI calculator free of cost. The
applicant can use such calculator on bank’s website by entering desired loan amount and
tenure. The calculator will provide the exact amount of EMIs the applicant will need to pay,
depending on the interest rates.

IV. Factors necessary to be kept in mind for getting easy approval:

o Choose a loan type to fit the business needs to avoid bad debt.
o Provide complete details, including previous years’ performance reports, current
financial position, and future plans. A comprehensive business plan backed by suitable
credit history will enhance applicant’s credibility and consequently, chances of
approval.
o Credit score validates your creditworthiness. A credit score above 700 increases the
chances of loan approval.
o Keep in contact with the loan officer for personal discussion on matters relating
to the loan application.