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Types of Home Loans Available in India

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  • Types of Home Loans Available in India

  • Different Types of Home Loans in India

Applying for any type of home loan in India is a perfect option for funding your house purchase and realizing your housing dream, especially when there are so many types of home loan instruments to help you realise your dream of owning a home.

A home loan or housing loan enables you to borrow money from the lender to buy a property of your choice and after the purchase, you can repay the loan to the lender through monthly installment. Several banks, financial, and housing loan establishments now offer different types of home loans to cater for the demands and requirements of different segments of society.

It also makes sense to check the home loan tenor, loan amount, and value-added features that align perfectly with your pocket, this will make your loan experience easier and more fulfilling too. Discussed below are the different types of home loans in India.

Different Types of Home Loans in India?

1. Land Purchase Loans

As the name implies, this type of home loan allows you to invest in land (i.e. you take this loan to purchase a landed property). You can then construct the land when you have the funds available. Also, don’t forget to use an EMI calculator to get a hold of the affordability and plan your repayment plan.

Documents required for land purchase loans are:

  • Age Proof (Birth certificate, etc.)
  • Address Proof (Voter ID, Utility bills, etc.)
  • Income Proof (Salary slips, etc.)
  • Identification Proof (PAN card, Passport, etc.)
  • Existing Loan Documents (if any)

2. Home Purchase Loans

This is the most popular type of home loan. It is taken to buy residential properties, such as a new home or pre-owned home (flats, bungalows or row houses). The eligibility criteria for applying to home purchase loans include:

For salaried applicants

  • Applicants must be between the ages of 23 to 68 when applying for a home loan.
  • Applicants must have Indian nationality.
  • Applicants must have work experience of up to 3 years. 

For self-employed applicants

  • Applicants must be between the ages of 25 to 70 when applying for a home loan
  • Applicants must be residing in India.
  • Applicants must have work experience of up to 5 years. 

The required documents for home purchase loans are:

  • Identity proof documents such as driver’s license and government-issued ID card
  • Proof of business for self-employed applicants
  • KYC documents 
  • Income proof documents or latest salary slip for salaried applicant
  • Bank statements
  • Previous income tax returns
  • Age proof documents such as birth certificates, etc.
  • Address proof documents, such as utility bills

3. Home Construction Loans

This type of home loan is only given to landowners to meet the cost of constructing a new home and it is generally dispersed in installment based on the progress of the construction project.

The eligibility criteria for a home construction loan are:

For salaried applicants

  • Applicants must be between the ages of 23 to 68 when applying for a home loan.
  • Applicants must have Indian nationality.
  • Applicants must have work experience of up to 3 years. 

For self-employed applicants

  • Applicants must be between the ages of 25 to 70 when applying for a home loan
  • Applicants must be residing in India.

The required documents for home purchase loans are:

  • Bank statements
  • Income proof documents e.g. latest salary slip for salaried applicant
  • Identity proof documents, for example; driver’s license and government-issued ID card 
  • Proof of business for self-employed applicants
  • KYC documents such as PAN cards
  • Address proof documents
  • Previous income tax returns
  • Age proof documents such as birth certificates, etc.

4. Home Extension/Improvement Loans

This loan ensures that you are able to expand, refurbish or renovate your already-owned home even when you don’t have the funds to do that. The eligibility criteria for home extension/improvement loans

For both salaried and self-employed applicants

  • Applicants must be between the ages of 23 and 68 when applying for a home loan.
  • Applicants must be residing in India.
  • Applicants must have work experience of up to 3 years. 

The documents required for home extension/improvement loans:

  • Age Proof (Birth certificate, Class 10 marksheet, etc.)
  • Address Proof (Copy of passport, Utility bills, Voter ID, etc.)
  • Income Proof (Salary slips and ITR details)
  • Property Title Deeds (Original)
  • Estimated Renovation Quotation

5. Bridge Home Loan

If you want to sell off any property for more expensive and valuable property, a bridge home loan helps to fulfil such a dream. They are offered at higher interest rates than other loan types with a maximum repayment tenure of up to 2 years.

Eligibility criteria for bridge home loans are:

  • Applicants must be salaried or self-employed individuals.
  • Applicants must be property owners between the ages of 23 and 70.

Find the documents required for a bridge home loan below:

  • Age Proof (Birth certificate, etc.)
  • Address Proof (Copy of passport ID, etc.)
  • Income Proof (Salary slips, etc)
  • Bank statement showing repayment of ongoing loan
  • Property-related Documents

6. Home Loan Balance Transfer

This is only given to an individual who wants to transfer an existing loan from a financial institution or any housing loan bank to another home loan provider. The major benefit of this loan is that it offers a lower home loan interest rate from the new lender and makes a top-up facility available.

The eligibility criteria for a home loan balance transfer are the same for a home purchase loan. In addition, both salaried and self-employed applicants must have a clean past record of timely housing loan repayment.

Here are the documents required for a home loan balance transfer:

  • Age Proof (Birth certificate, etc.)
  • Address Proof (Copy of passport, Utility bills, Voter ID, etc.)
  • Income Proof (Salary slips, etc.)
  • Bank statement showing repayment of ongoing loan
  • Property-related Documents
  • List of property documents in possession of the existing lender

For more information on how you can get any of the above-mentioned home loans, log on to our website to see our wide range of home loan options today.

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