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1. What are the types of Home loans available?

Ans.: The following kinds of home loans are available:
  • Home Purchase Loan
  • Home repairs Loan
  • Home Construction Loan
  • Home Extension Loan
  • Land Purchase Loan
  • Loans for NRIs
2. Tax benefits :

Many of us have taken home loans / mortgages to buy our house. One of the most important motivators for availing a housing loan is the income-tax benefit that it provides. If you have availed a home loan, you can claim tax benefits on both the principal and interest components of the home loan as per the Income Tax Act. These benefits are in the form of deductions available to assesses who have taken a loan to either buy a house or build one. You can reduce your tax liability by a maximum of Rs.6250 per month (Rs.75000 p.a.) (for self occupied property) Under section 80,repayment of principal of up to Rs.1 lac is deductible in full from your income which means you can save tax up to a maximum of Rs.30,000 p.a. on principal. Similarly under section 24 of the Income Tax Act, interest is deductible up to a maximum of Rs.1.5 lac. Thus, this leads to an additional saving of a maximum of Rs.45000 p.a.

  • Can you get IT certificates in the name of both the applicant and co-applicant separately?
    As per IT rules, only one certificate can be issued for a Home Loan hence one certificate will be issued in the name of both the applicant and co applicant.
  • When is the IT certificate issued?
    You can request for a provisional IT certificate that can be issued any time during the course of the year.
3. What is an EMI?
You repay the loan in Equated Monthly Installments (EMIs) comprising principal and interest. Repayment by way of EMI commences from the month following the month in which you take full disbursement.

4. Documents required For Loan:
Generally, the documents required to process a loan application are similar across all banks.
The following documents are required by Banks to process a loan application:
  • Proof of age
  • Proof of address
  • Proof of income of the applicant & co-applicant
  • Bank statements of the last 6 months
  • Passport size photographs of the applicant & co-applicant
Salaried individuals
  • Salary slip / Form 16 A
  • A photocopy of the first and last pages of Ration card or copy of PAN/Telephone/Electricity bills
  • A photocopy of LIC policies with the latest premium payment receipts (if any)
  • Photographs (as applicable)
  • A photocopy of bank statements of the last six months
Self-Employed/Businessmen
  • A brief introduction of Business/Profession.
  • Balance Sheet, Profit and Loss account and statement of income with Income Tax returns for the last 3 years certified by a CA.
  • A photocopy of Advance Tax payments (if applicable).
  • A photocopy of Registration Certificate of establishment under shops and Establishments Act/Factories Act.
  • Bank statements of Current and Saving accounts for the last 6 months.
  • A photocopy of Certificate of Practice(if applicable).
  • A photocopy of any other bank loan (if applicable).
  • A photocopy of the first and last pages of the Ration card or a copy of PAN/Telephone/Electricity Bills.
  • A photocopy of LIC policy (if applicable).
If a flat is purchased from the builder
  • Original copy of your agreement with the builder.
  • 7/12 extract or property register card of the land under construction.
  • Index II extract of your agreement with the builder.
  • Copy of N.A. permission for the land from the collector.
  • Search and title report (with the details of documents) for the last 30 years.
  • Development agreement between the owner of land and the builder.
  • Copy of order under the Urban Land Ceiling Act.
  • Copy of building plans sanctioned by the competent authority.
  • Commencement certificate granted by Corporation / Nagar Palika.
  • Building completion certificate(if available).
  • The latest receipts of taxes paid.
  • Partnership deed or memorandum of association of the builders firm.
If constructing on own land/ plot
  • Original sale deed of land and extract of Index II.
  • 12 extract or property register card in your name.
  • Copy of N.A. permission for land from the collector.
  • Search and title report (with the details of documents) for the last 30 years.
  • Copy of order under Urban Land Ceiling Act.
  • Copy of the building plans sanctioned by the competent authority.
  • Building permission granted by Corporation / Nagar Palika.
  • The latest receipts of taxes paid.
  • Estimate of cost of construction certified by the architect.