Most borrowers apply for home loans unprepared and as a result their applications get rejected at the preliminary stage itself. While, there is no doubting a fact that applying for home loans these days through web portals like housing.com is simple and easy, it is essential that buyers must thoroughly prepare before making the application. Here are some of the common problems faced when applying for home loans –
Rejection at the application stage
Most housing loans, home loan topup, credit for construction, etc. are rejected at the application stage itself.This is because either application forms are not filled correctly or the buyers furnish incorrect information. Having said this, the rejection at the initial stage is valid mostly for offline applications andthe customers do not have to go through this trouble in case the application is made through online source like housing.com. This is because in online application the form cannot be submitted unless all of the mandatory information is filled.
Unableto meet the eligibility criteria
The other problem that several home buyers face is that even though they do most things right they are still unable to get the home loans since their income levels do not meet the requisite criteria. The crux here is that they come to know about the eligibility thing only after sufficient time is passed and at times this could result in deals getting cancelled or seller demanding extra money. Hence, it is advisable to check the home loan eligibility beforehand itself on credible web portals like housing.com. This will ensure that there is no undue delay in home loan process.
Forfeiting of processing fees
There have been many instances wherein home buyers had to part way with processing fee because they could not meet the lenders criteria for home loan. Most creditors ask for processing fee at the application stage itself. Hence, it is advisable to take help of financial experts from sites like housing and exercise all due diligence before applying for home loans. This will ensure that prospective home loan customers do not have to go through the hassles of their applications being rejected.
Lower amount sanctioned
The other common issue that most home buyers face in India is lower loan amount sanctions. The banks and housing finance companies have different parameters for evaluating the worth of property and hence the amount sanction also differs. At the same time, not all creditors include stamp duty, registration, service tax and other charges while calculating the cost of home and hence the amount disbursed differs. It is therefore important that buyers must consider all of these factors and carefully choose the lender that fits their requirement from all perspectives.
The interest rate issue
There are no uniform interest rates that lenders in India charge. Most banks and housing finance entities have the home loan interest rates linked to their base rate and they cannot go down the base rate at any point of time. Nonetheless, interest rate is an important factor and it can differ from anywhere from 0.5% to 2.0% across lenders. However, interest rate is not the only issue; the miscellaneous charges associated with home loans also differ.Hence buyers must take into the bigger picture and carefully all pros and cons before applying for home loans.