Mortgage loans fall under the high-value credit forms preferred by borrowers. The easy accessibility and simple terms make it a viable loan option.
According to a report, the Indian loan against the property market is predicted to grow over 14% CAGR by FY2026. Prompted by this growth, many lending institutions levy affordable mortgage loan interest rates on the said credit form.
However, individuals should learn the right application process to marginalize any chances of loan cancellation or related issues.
Process of applying for a mortgage loan
With digitalisation, potential borrowers can avail the said credit by following simple steps. Following this process will further help borrowers get a clear idea of how to apply for a mortgage loan without physically visiting any lending institutions.
Step 1: Visit the preferred lending institution’s website and select Mortgage loan from the product tab
Step 2: Fill up the online application form with relevant details. This can include both personal and professional data
Step 3: Submit this form and wait for a representative to get in touch
The loan application will get approved after submitting the right documents. Typically, the credit is transferred to a borrower account after surpassing all the parameters. Hence, individuals should be aware of the factors that affect the loan application and approval.
Factors to check for hassle-free LAP application
It is imperative to know that simply understanding what is mortgage loan and its application won’t make borrowing successful. There are instances of loan cancellation or rejection due to minor issues.
Here are some factors that potential loan against property borrowers must check to make the most of the credit.
Check eligibility criteria
Checking the eligibility parameters is the basic responsibility of every applicant. This helps them analyse their financial capabilities and work on its improvement, if necessary.
The LAP eligibility parameters can vary from lender to lender. However, most of the criteria are similar for almost all lenders. This includes employment status, age, nationality, etc. Borrowers will qualify for a loan against property by meeting these simple eligibility criteria-
For salaried individuals –
- An applicant should fall in the age bracket of 28 and 60 years.
- They should be working for an MNC, public or private sector.
- Applicants should have Indian residency.
For self-employed individuals –
- Prospective borrowers should be aged between 25 and 70 years.
- Individuals should maintain a steady income and employment profile.
- They must be an Indian resident.
Every lender, irrespective of the credit form, sets a list of documents mandatory for loan application. For instance, in a reverse mortgage loan, borrowers will have to submit papers that substantiate their reliability. Similarly, LAP applicants can avail the benefits when they complete the documentation process.
Some of the necessary documents required to avail of this credit include –
- KYC documents
- Statements from a financial institution for the last three months
- Salary slips
- Papers related to the mortgaged property
- Income tax returns.
These requirements fall under the list of documents needed to apply for a loan against property. However, one must know that lenders can ask for additional papers depending on their lending policy.
A lending institution reviews a borrower’s credibility before deeming them their mortgage loan eligibility. This ensures their repayment capability and reliability for borrowing. To leverage the score, individuals should ensure that there is no outstanding debt. In addition, they should implement ways to bring their CIBIL score to 750+. Finally, making timely repayment will again leverage credibility. In this regard, one can use a mortgage loan calculator and evaluate the total fund involvement to save accordingly. Maintaining a decent credit score will help borrowers gain negotiation power that can help them reduce their interest outgo.
Moreover, applicants are obligated to receive customised features and better service. For instance, several HFCs extend pre-approved offers to existing borrowers. Usually, these offers are levied on credit forms like LAP, home loans, etc. Now you can check your pre-approved offer by providing details like your name and contact number.
These are some of the factors that mortgage loan applicants must check before applying for the same. Having a clear idea about the loan processing and the steps involved will again help applicants initiate savings for future endeavours.