All it takes to complete a financial transaction now is a computer, smartphone, and internet connection thanks to technological advancements. This also applies to loan applications of any kind, including those for home loans. The typical offline procedure, in contrast, requires one to visit with their paperwork to the loan provider’s offices, which takes time and is inconvenient.
Today, the majority of lenders who offer home loans offer the option of applying online. An applicant can register on the lender’s website, fill out the application, and electronically submit it with all of their supporting documents. Additionally, the applicant will be able to pay for the loan application online. To determine the loan amount one is eligible for while applying for a home loan, one can go to the lender’s website and use the eligibility calculator.
You may find the best interest rate and maintain a low total interest expense during the duration of your home loan by comparing loans from several lenders. We walk you through the dos and don’ts to remember while submitting an online application for a home loan. By using these suggestions, you’ll increase your likelihood of loan acceptance, shorten the approval procedure, and get the best home loan rates.
Dos and Don’ts while applying online for a home loan
Do check your credit score
Your creditworthiness is assessed using a three-digit number called a credit score. The easier it is to qualify for the finest home loans, the closer the score is to 900. Before approving a house loan, all lenders check your credit score. Therefore, be sure to check your credit score before applying for a home loan.
Do pick a home loan that you can afford.
Borrowers frequently have a tendency to overextend themselves when they apply for home loans due to the simple availability of home loans and the competitive home loan offers. They take on more debt than they can handle, which forces them to make expensive monthly payments known as EMIs. As a result, they forego achieving other important financial objectives. To determine the ideal EMI amount that fits inside your spending plan, use a home loan EMI calculator.
Do your research
Your EMI payments for a home loan will probably last for at least 20 to 30 years at a time. Therefore, you must make sure that you select the lender who provides the greatest home loan packages.
Do fill out the online application correctly
When submitting an application for a home loan, be sure to include all necessary financial information. Key information omitted, such as income levels, extra sources of income, and outstanding debts, could prolong the approval process for a home loan and even result in your application being rejected.
Additionally, make sure you submit accurate information; if you fake any information, the lender will discover it. Giving false information can result in your loan application being rejected as well as delay the loan approval process.
Do save for a large down payment
Home loans should ideally only be approved for up to 80% to 85% of the value of the house. A borrower is required to make all remaining payments out of pocket. You lower the risk assumed by the lender by putting down more money than is legally required. This raises your credibility and raises the likelihood that the loan will be approved.
Don’t go for a long tenure
Although home loans have a maximum 30-year term, you should aim to pay off the loan as soon as you can. The home loan interest rate outflow increases with tenure length.
Don’t ignore the fine print
The bulk of debtors frequently make mistakes like these. Make sure you thoroughly read the loan agreement and are familiar with all of the terms and conditions, particularly the processing fee, late fees, and foreclosure charges.
Don’t hesitate to choose a joint home loan
A joint housing loan increases your chances of getting approved for a loan, particularly if the co-applicant has a solid credit score and is a member who is employed. Additionally, you qualify for lower interest rates on house loans if you add a female co-applicant.
Don’t take loans or credit cards, right before a home loan
Remember that the lender reviews your credit history before approving your house loan application. Lenders are wary when you open a new credit card or take out a second loan since it increases your debt load. Therefore, waiting to apply for fresh credit before taking out a housing loan is a wise idea.
Don’t quit your job before taking the loan
Borrowers with a solid job and regular income are preferred by lenders. Whether or not your house loan is accepted depends greatly on your income and occupation. Loan denial may result from quitting or changing employment just before applying for a loan. So it makes sense to stick with your existing employer if you intend to buy a house in the near future.
You’ll have a better chance of getting a house loan fast and at the best rate if you abide by these dos and don’ts.