Moving into a home which you can call your own gives you the highest level of satisfaction. Buying a new or under-construction house has been a common trend in India. However, there is a large market for property resale, and buying old or used homes quickly becomes an accepted norm.
If you are planning to buy a used apartment, arranging a home loan will not be an issue. There are many banks and financial institutions that offer home loans for the same. Here are the various aspects you need to know while applying for a home loan against a resale flat.
Loan eligibility criteria
- The applicant’s minimum age must be 18 years at the time of the sanction of the loan.
- The maximum age of the applicant during the repayment of the loan must be below 65-70 years, which can vary from lender to lender.
- The borrower must have a good credit score, preferably 700-750 points or more.
How to apply for a home loan?
- You can apply for the resale home loan both individually or jointly. The co-applicants can either be the spouse or any close family members.
- These home loans can be applied through online and offline options.
- Once you have applied for the loan, a certified chartered engineer may survey the resale flat or home you wish to buy. If done, the engineer will prepare a report on the same and send it to the lender. They will calculate the valuation, amount and you may receive 70%-90% of the valuation amount as your home loan, depending on the loan to value ratio of the lender.
Home loan terms
The home loan interest rates and tenure depend on a variety of factors such as,
- Borrower’s profile
- Borrower’s age at the time of loan maturity
- Scheme of repayment
- How old will be the property at the time of loan maturity
Type of home loan interest rate – The interest rate is determined at a floating or fixed rate, or the lender makes a combination offer. The home loan interest rates for a resale flat can start from as low as 6.9%, depending on the prevailing rates at the time.
Documents required for the approval of the home loan of resale property
- Home loan application form correctly filled and signed
- Passport size photo of the applicant(s)
- Identity proof
- Residence proof
- Business establishment proof
- Income proof
- Property documents
- Bank statement
Resale apartments don’t come much cheaper than new ones. Therefore, use a home loan EMI calculator to figure out the EMI burden on your monthly budget. If everything fits, soon you can have a home ready to move into!