Home Loan Pre-Approval: Why It’s Important and How to Get It

Home Loan Pre-Approval

Home Loan Pre-approval

Banks, financial institutions, and small financing firms in India offer different types of home loans to buyers and investors. One of the most attractive options is the pre-approved home loan. Financial institutions offer this type of loan to individuals who maintain a healthy CIBIL score. People with strong financial status and ethical buying behavior often receive pre-approved home loan offers.

If you have an imbalanced financial status or a negative loan history, banks in India may not grant you such privileges. Banks use pre-approved home loans to encourage individuals to buy their dream homes by dividing the total property cost into easy EMIs. In this guide, we will explain the importance of home loan pre-approval and outline the process you should follow to get early approval from banks.

Benefits Of Home Loan Pre-approval

Many people may find it useless in the absence of any concrete budget plan or knowing about the actual cost of a property. But the fact is that getting a pre-sanctioned home loan can be really advantageous for people who are planning to purchase any property soon. If you want to invest in 3BHk flats in Zirakpur, you can cross-check for your eligibility for the home loan pre-approval. Let’s discuss some benefits of it.

Helps In Deciding The Budget 

Getting a pre-approval for a home loan even before applying for it can give you an idea of how much loan amount can be borrowed from the bank at the time of property purchase. However, the final sanctioned amount can vary based on various factors like type of property, location, size of a property, and actual deal price of the property. But you can still decide upon the budget bracket to invest in the home purchase. 

Makes Property Search Process Easy 

If a bank or any financial institution pre-approved your home loan with a specific amount, it can be a motivational factor for some people to start searching for a property. It can give you partial assurance that you are backed by the bank for a particular amount, and the rest you need to arrange at the time of registration. Thus, it makes your property search process easy and practically in picture. 

Negotiate Better Deals With Builders & Realtors

If you already have a pre-approved home loan, you can negotiate a better deal with builders. Having a positive financial status with a consistent flow of monthly income in the account can help you get the pre-approved home loan offers from different banks. It has been observed that builders & real estate agents offer better deals to people with a positive CIBIL score and stable financial status. 

Easy Processing & Disbursement 

Getting the home loan pre-approval from a reputed bank or financial institution can make the home loan process easy, and you can expect the timely disbursement of the sanctioned home loan amount from the bank. However, documentation and other formalities play a crucial role in this process.

How To Get Home Loan Pre-approval?

However, banks often send a text message to the person who gets the pre-approved home loan considering his income, potential for the loan repayment, CIBIL report, and other related factors. However, if you still want to process your home loan pre-approval, then you can follow these steps.

Check Your CIBIL

The CIBIL score plays a vital role in describing your financial status and your loan repayment behavior. Thus, it is important to check your CIBIL score at this stage. 

Collect All The Required Documents 

When you are initiating the process to check for the pre-approved home loan, you need to collect all the required documents for the application. Documents like identity proofs, residential proofs, income tax returns (for the past 2–3 years), salary slips, and bank statements (for the past 6 months). 

Mind The Budget 

It is necessary for a person to calculate the total budget he wants to spend on buying a property. Consider all the factors, requirements, and costs to finalize the budget. You can take the help of Real Estate Portal to decide upon a feasible budget. 

Look For Loan Providers

Once you have done all the homework, now is the time to find out the potential loan providers. You can compare the offered home loan amount, interest rates, and other offers. Now, choose the lender who best suits your requirements. 

Apply For The Home Loan Pre-Approval 

Here, you need to submit your application for the pre-approved home loan. Fill in the application form and provide all the necessary details. Don’t forget to provide all the required details to avoid any rejections or delay. 

Submit Your Documents 

Once your application is submitted, wait for the officials to cross-verify your application. In the next step, you need to submit all the required documents duly signed with the required passport-attached passport-size photographs. 

Wait For The Lender’s Review 

After submitting your documents, you need to wait for the lender to review your application and documents before the final approval. It may take a while. Be patient. 

Receive The Sanctioned Pre-approval Letter

Once you complete all the formalities, the lender issues you a pre-approval letter for your home loan application. You can then use this letter to negotiate a better property deal with more profit.

Conclusion

Pre-sanctioned home loan offers encourage people to own their dream homes for affordable and easy EMI plans. Home loan pre-approval helps a home buyer to buy a quality home. However, lenders to detailed inspection of the subjected property while sanctioning the asked home loan amount. 

They measure every Inch to Sq. Ft. Area for the justification of the loan provided. Therefore, it is recommended that the home buyer must provide all the factual information and details beforehand to avoid any last-minute hassles. Always remember to work out the better interest rate and comfortable repayment tenure deal with the bank. For online assistance regarding the home loan pre-approval process, please contact us now.

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