Owning a home is one of the topmost priorities and dreams of most individuals. For individuals aged between 23-30, buying their first home is a matter of pride, whereas buying a bigger or better house is a way to upgrade the living standard for middle-aged people. With ample housing schemes and the wide availability of home loans, anyone can turn this dream into reality.
A home loan is one of the most prominent forms of financial aid that helps individuals buy their dream home by giving them access to the necessary funds at the time of purchase. Whether you’re a self-employed professional, salaried individual, or businessperson, you can easily get a home loan, provided you submit all the required documents.
Before jumping into the documents required for home loan, let’s check what the eligibility criteria are.
Home Loan: Eligibility Criteria
- For Salaried Individuals:
You must have a permanent service in a reputed company or any government organization.
- For Self-Employed Professionals:
You must have a professional qualification or license to practice what you’re doing. This implies to professionals like chartered accountants, architects, engineers, doctors, etc.
- For Businessperson/Self-Employed Individuals:
You must have income tax returns for at least the last two years.
Note: For every scenario, the lending institution has set the same age criteria for home loans. You must be above 24 years of age at the time of loan commencement and age up to 60 years or less at the time of loan maturity or end of the loan tenure.
Getting a Home Loan: Other Criteria
- Whether you’re self-employed or salaried, the general requirements for getting a home loan include a strong credit portfolio and healthy earning records.
- Your income will help lenders to know whether you’re capable of repaying the loan or not.
- Meanwhile, the credit portfolio represents your willingness and discipline to repay loans in time.
- To determine whether you’re eligible to get a home loan, the lending institution will need to attach certain documents along with your application form. These documents may vary depending on your work profile.
- The lender evaluates the documents required for a home loan to determine your source, frequency, continuity, and consistency of income for the loan approval.
Here are some crucial documents that you will need for your home loan application process.
Documents Required for Home Loan: For Salaried Individuals
If you’re a salaried individual, you’ll have to submit the following documents along with the application form:
- Bank statements showing the transaction record for the last six months (including statements from your salary account).
- Employment letter (if your service period in the current company is less than a year).
- Current income tax return form.
- Salary slips for the last three months.
Documents Required for Home Loan: For Self-Employed Individuals
Self-employed professionals and business people will have to submit documents to prove their financial condition as well as their business or practice. These documentations include:
- Income statements and balance sheets (including schedules and annexures), all certified by the auditors
- Details of any ongoing loan of both the owner and the business enterprise, including security, installments, and outstanding debt amount
- Copies of VAT registration, Shop & Establishment license, and other licensing info.
- Copies of professional practice and educational qualification certificates
- Income tax returns showing income for the last three years.
- Current business account statements and savings account statements (of the self-employed professionals) of the last six months.
- List of shareholders and directors with details on shareholding (must be certified by a company secretary or chartered accountant).
- Copies of MoA (Memorandum of Association) and AoA (Articles of Association) (if required)
Final Words
Whether self-employed or salaried, every home loan applicant needs to submit KYC documents along with the above-mentioned documentation. The KYC documents include address and identity proof. Moreover, you should submit the property-related documents, which may vary depending on the type of property you want to purchase. So, all the best with your loan application process, and we hope it gets processed and disbursed in no time.
