Home Loan Checklist: Things to Keep in Mind

Applying for a home loan is often par for the course while deciding to purchase a property. Purchasing a home is one of life's biggest achievements and it can be possible when you apply for a home loan. Yet, before you apply,  make sure that you create your own  home loan checklist. This will ensure that you have a proper blueprint in place for obtaining your home loan.

Home Loan Checklist- Key Components of the Home Loan Process

Here are some aspects of the home loan process that should be integrated into your home loan checklist.

• Credit Score- You should remember that banks closely scrutinise the credit scores of all home loan applicants. It is one of the prime factors influencing not just your loan eligibility, but also the final loan amount. You should always attempt to improve your final credit score before you apply. It is possible through consistently repaying your debts and making payments before their due dates without any defaults. You can also clear off dues on other loans and get a credit report to check the credit score.
• Down Payment Amount- Remember that you have to pay a part of the cost of the home as the down payment. This can vary between 15-30% depending on your eligibility, the loan amount, and the bank’s policies. Hence, you should accurately assess the contribution that you have to make and be ready to pay it to the developer accordingly. The LTV (loan to value ratio) is also another aspect that will help. It means the amount ratio sanctioned by the bank as against the value of the property.
• Documentation- While filling up the application form and applying for the home loan, you will have to submit diverse documents. These may include your age, address, and residence proof, along with proof of your income, salary slips, bank account statements, proof of employment, and the property papers which are legally verified. Make sure that these documents are all available whenever you need them.
• Pre-Approved Home Loan- Another aspect worth including in your home loan checklist is a pre-approved home loan that the bank may offer to you, based on your eligibility and income. This will help you understand the amount that you can get and finalise your property likewise.
• Eligibility Criteria- You should carefully scrutinise the eligibility criteria including the credit score, age, occupation type, monthly income, existing debts, and so on.
• Total loan costs- You should carefully check the various home loan charges that are applicable, including the processing fee, administrative costs, and so on.
• Rate of interest and tenure- Check whether the bank is offering you a fixed or floating interest rate. Compare these two types of rates minutely to understand which one is right for you. Check the rate applicable for you, depending on your eligibility and also whether the bank is offering you your chosen tenure or not.
• Your monthly EMI- Calculating the monthly home loan EMI is a vital part of the home loan process. An online calculator may be used to work out the amount that you have to pay as your EMI every month. It is a process that should be completed prior to the application procedure. You can thus understand your repayment ability and the amount that you should apply for at the bank. 
• Bank Verification of the Property- While deciding whether to sanction a home loan, the bank should undertake an inspection and verification of the legal status of the property that you wish to purchase. Ensure that this is done in order to get another layer of safety for your purchase.

You should include the above-mentioned aspects in your home loan checklist for a smoother and more successful home loan application process. You should always compare interest rates and loan charges across lenders, along with the amounts and LTV ratios as much as possible.

This will help you finalise your decision with regard to choosing a lender. Getting a home loan is not difficult, provided you do your homework and adhere to the checklist that is given above. Make sure that you examine the terms and conditions with care. This should be done before you sign on the agreement. On that note, here’s to a successful home loan application ahead!