Documents Required to apply for Home Loan

In India, every individual holds a dream of building their own house, however many face financial challenges in doing so. This is where a home loan can help. A home loan, also known as a housing loan, is a financial product offered by banks and financial institutions to help individuals purchase or construct a residential property. It is a long-term loan that allows borrowers to repay the borrowed amount in fixed instalments over a specified period. However, before applying for a home loan, it is crucial to understand the documentation requirements. Lenders require specific documents to evaluate the borrower’s creditworthiness and assess the risks involved.

If you’re also in line to apply for a home loan, this blog will guide you through the types of documents required for a home loan application in India, catering to all types of individuals.

Types of Documents Required for Home Loan

The documentation process for a home loan involves providing various financial and personal documents. While the specific requirements may vary across lenders.

Following are the common types of documents needed:

1. Home Loan Application Form
2. Borrower’s Identity Proof (Any one of the documents mentioned below)
   -PAN Card
   -Passport
   -Aadhaar Card
   -Voter’s ID card
   -Driving License
3. Borrower’s Residence Proof ((Any one of the documents mentioned below)
   -Bank Passbook
   -Voter’s ID
   -Ration Card
   -Passport
   -Utility bills like electricity bill payment
   -LIC policy receipt
   -Letter from a recognised public authority verifying the customer’s address
4. Borrower’s Age Proof
   -Aadhaar Card
   -PAN Card
   -Passport
   -Birth Certificate
   -10th Class Marksheet or Bank Passbook or Driving License
5. 3 Passport sized photographs
6. Bank Account Statement of the last 6 Months
7. Income Proof like Salary Slips for Salaried Individuals and IT returns for self-employed professionals or self-employed businessmen
8. Form 16/IT Returns for the past two financial years for salaried individuals
9. Signature verification by the banker of the applicant
10. Liabilities statement and personal assets
11. Property complete and detailed document-
    -Allotment Letter or Buyer Agreement
    -Receipts for payments made to the developer (if you’re building a new house)
    -A copy of the sale agreement
    -A copy of the plan approved by local authorities
    -In the case of house resale, title deeds including the chain of previous property documents
    -Proof of no encumbrances on the property
    -In the case of house making, a detailed estimate of house construction by a civil engineer or an architect
    -Receipt of initial payment made to the house seller
    -In case of house construction, title deeds of the plot
12. A cheque for processing fees

Read more: Minimum salary required to get a personal loan

Documents Required for Salaried and Self-Employed Applicants

While the basic documents mentioned above apply to both salaried and self-employed applicants, there are a few additional documents specific to each category:

For Salaried Applicants:

1. Salary Slips: The latest three to six months’ salary slips, depending on the requirements.
2. Form 16: The Income Tax Department issues this form, and it reflects the salary earned and taxes paid during a financial year.
3. Employment Proof: An employment verification letter from the employer, stating the designation, joining date, and salary details.
4. IT returns of past 3 years: Applicant needs to attach IT returns for the past 3 years to show proof of stable income.
5. Increment or Promotion Letter: If you have been recently promoted or got an increment, you can attach the letter.

For Self-Employed Applicants:

1. Business Proof: Documents like a business registration certificate, partnership deed (if applicable), and business profile are required.
2. Income Tax Returns: The latest income tax returns (ITR) filed for the previous three years, along with the computation of income, profit and loss statement, and balance sheet duly attested by a CA.
3. Business Continuity Proof: Documents like the company’s bank statements, audited financial statements, and GST registration certificate, if applicable.
4. Business License details or licence of professional practice for doctors, pharmacists etc.
5. Business Address Proof: Self-employed applicants need to provide relevant documents for proof of business address.

Also Read: What is an Unsecured Personal Loan?

Home Loan Documents Required for NRIs/PIOs Applicants

NRIs and PIOs looking to apply for a home loan in India must provide the following additional documents:

1. Passport and Visa: A copy of the passport containing the applicant’s personal details and valid visa documents.
2. Overseas Address Proof: Proof of residence abroad, such as utility bills, rental agreements, or employment contracts.
3. NRI Bank Statements and Income Proof: Bank statements of NRE/NRO accounts for the past six months, showcasing the source of funds and the last three months’ salary slip.
4. Employment Contract: Offer letter duly attested by an employer or foreign office or embassy in case it is in other languages.
5. Last Year ITR: Duly acknowledged copy of previous year’s ITR except for PIOs or NRIs located in Middle Eastern countries and employees in the Merchant Navy. And for Merchant Navy employees, a copy of the continuous discharge certificate (CDC).
6. Form P60/P45 and employment contract from the employer.
7. Business license, business address proof, income proof: Self-employed applicants need to provide a business license, address proof, last 3 years’ balance sheets, last 3 years’ ITR, and last 6 months’ bank statement.

Along with all these documents, property documents need to be attached.

In conclusion, when applying for a home loan in India, it is essential to have the necessary home loan documents ready, in order to streamline the process and increase the chances of loan approval. In addition, if you are in need of a loan but want to get it done quickly and without much hassle, then apply for a personal loan from Airtel Flexi Credit. The whole process is extremely swift and you can pay back your loan amount in easy EMIs, without breaking any sweat!