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Pre-sanctioned Home Loans may not always be a Best Option

It would be nice to avail a loan before you zero down on your dream home but pre-approved home loans may not be all that rosy at seems. The procedure of acquiring one is not all that different from acquiring a regular home loan. The documents which you will be asked to submit include, depending on whether the applicant is a salaried individual, self-employed professional or an entrepreneur, the identity and residence proofs, the latest salary slip, Form 16, past six months’ bank statement, past three years’ income-tax returns (self and business) as well as profit/loss statements and balance sheet, certificate and proof of business existence and so on. The repayment capacity will be taken inot consideration apart from your income capacity.

A pre-approved home loan will be provded to the borrower only if he is able to finanlize the house within a specifi time period, as stipulated by your bank. “There is no typical period within which the loan seeker is required to avail of the disbursement. However, we keep the file open for six months and if the applicant does not act within this period, we send reminders to the individual,” informs an HDFC spokesperson. The State Bank of India , which has been publicising this facility of late, requires the borrower to identify the property within 60 days for the sanction to be valid.

Advantages :

Availing pre approved home loans helps borrowers to negotitate witht hte builders concerning rates. It makes the borrowers find their homes because banks advise their borrowers to look out for those properties that meet their criteria. Many lenders have tie ups with builders relating to various projects. In such cases, if the borrower expresses his wish for finding the right property, he may do so by approaching the bank and explain. If both the desired project, suggested by the bank, and the loan is pre-approved then it is a great take away for the borrower since the processing time will be quite shorter.

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