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How To Apply for Home Loan Online?

By Sakshi Srivastava - 16 Dec 2021 Last Updated: 11 Aug 2022
How To Apply for Home Loan Online?

The term Home Loan refers to a loan used to purchase or maintain a home, land, or other types of real estate. The borrower agrees to pay the lender over time, typically in a series of regular payments that are divided into principal and interest. The property serves as collateral to secure the loan. A borrower must apply for Home Loan through their preferred lender and ensure they meet several requirements, including minimum credit scores and down payments. Home Loan applications go through a rigorous underwriting process before they reach the closing phase. Home Loan types vary based on the needs of the borrower, such as conventional and fixed-rate loans.

How does Home Loan Works?

Home Loan are used by individuals and businesses to purchase real estate without paying the whole purchase price up front. The borrower pays back the loan plus interest over a set period of time until they acquire the property outright. Liens against property or claims on property are other terms for mortgages. If the borrower defaults on the loan, the lender has the option to foreclose on the property.

A residential homebuyer, for example, promises his or her home to their lender, who then has a claim on the property. If the buyer defaults on their financial obligations, this protects the lender's interest in the property. In the event of a foreclosure, the lender has the option of evicting the occupants, selling the property, and using the proceeds to pay off the mortgage debt.

How To Apply for Home Loan Online?

Here is a step-by-step guide to apply for Home Loan Online 

Step 1 - Access the Home Application Form

The first step is filling the application with a few details like name, phone number, pin code, type of employment, etc.

Step 2 - Enter Personal, Financial, and Employment related details to get a Pre-Approved Offer

If you are self employed person then you would be required to show your bank statement for (6-12 months)

In case you are an employee then you would be asked to show your salary slip or proof of income

Different documents can be asked by different banks it’s not mandatory that all the banks follow same guideline

Step 3 - Choose the Loan Amount with the Home Loan Eligibility Calculator

If you're looking for a Home Loan, an online Home Loan calculator can help you compare expected monthly payments based on the type of loan, the interest rate, and the amount of money you want to put down. It might also assist you in determining how much property you can afford.

Step 4 - Provide Property Details

There are several kinds of property documents required for a home such as: -

  • Sale Agreement
  • Encumbrance Certificate
  • Property Map
  • Allotment Letter from the Builder
  • NOC from Builder
  • MODT (Memorandum for deposit of title deed)
  • Property Chain
  • Registration & Stamp Duty Receipt

Step 5 - Pay the Online Secure Fee

Login Fee: Sometimes also called the Administrative Fee or Application Fee, this is a non-refundable amount charged by certain banks when you apply for a loan, even before your loan is approved

The processing fee of a bank usually:

  • Ranges from 0.25 % to 0.50 % of the requested loan amount.

Step 6 - Upload scanned copies of documents

You must upload scanned documents that are listed below : -

  • Income proof
  • Identity (or ID) proof
  • Age proof
  • Address proof
  • Employment details
  • Educational proof (school/diploma/degree certificates)
  • Bank statements

What are the Different Types of Mortgages or Home Loans in the UAE?

In the UAE, there are various types of home loans that vary based on the rate of interest; this is the most important factor to consider when deciding whether the deal is good or not.

The following are the many types of mortgages available in the UAE:

Fixed Rate Mortgage

Mortgage with a fixed rate. It's the simplest one, in which you agree on a set interest rate percentage before the loan period begins.

 It's a fantastic alternative because it won't be influenced by future events, allowing you to determine the exact amount you'll pay in each installment for the entire period with no variation.

Variable Rate Mortgage

Mortgage with a variable rate. This type has a variable interest rate, as the name implies. It varies depending on the market or any new rules enacted.

It's a two-edged sword since the drop or increase is unforeseeable. Just make sure you're financially secure before going with this option to ensure you'll be able to afford any increases.

Discount Rate Mortgage

The term "discounted rate mortgage" refers to a loan with During the first months of the loan term, the borrower offers you a reduction in the amount of a set percentage.

You must determine whether this type is appropriate based on the amount you will pay once the discount period expires, or it will be a risky alternative.

Capped Rate Mortgage

Mortgage with a fixed rate cap. This one is like the Variable Rate Mortgage in that the interest rate is not fixed; but, before the loan period begins, you agree on a maximum rate of interest.

Whatever market fluctuations occur, the interest rate will not exceed the agreed-upon maximum limit.

Remortgage. This type is ideal if you have already applied for a loan and require an additional one while your current loan is being processed.

Offset mortgage

Mortgage with a negative balance. You may now link your loan, savings, and credit accounts with this new feature. As a result, anytime you receive additional funds on any of your accounts, the total interest amount is reduced.

Conclusion

Securing a good Home Loan can be a tough task It requires a hefty amount of paperwork and time still it doesn’t guarantee that your loan would be approved, Experts at Dhanguard will help and guide you to choose the right Home Loan at best interest rates that suites you. For more information visit to our website at Dhanguard.com

By Sakshi Srivastava

16-Dec, 2021

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