What Documents Do I Need for a Home Loan Application?

Introduction

Buying your first house is indeed a monumental experience; it doesn’t matter if it’s a flat in the heart of a thriving city or building a house from the ground up on tranquil land. This immense happiness of buying your own home cannot be put into words.

Yet, before you can decide on paint colours or start sending out party invitations, the very crucial aspect of buying your first house is applying for a home loan.

Home loan applications can seem extremely overwhelming due to financiers’ cautious verification policies. Hence, a small, misplaced paper might extend the entire process to weeks.

In this regard, to guide you easily, we have prepared a list of all the indispensable documents required for a home loan application.

Know Your Customer (KYC) Documents

This is a requirement for all financial institutions for loan applicants. Hence, KYC documents are indispensable as the lenders need proof of the applicant’s identity and residence.

Documents to be provided include self-attested copies of the following:

• Identity Proof: PAN Card (Mandatory), Aadhaar Card, Passport, or Voter ID
• Address Proof: Aadhaar Card, Passport, Driving Licence, recent Electricity Bill, or recent Water Bill
• Age Proof: Aadhaar Card, Passport, or School Leaving Certificate (Class 10th)
• Photographs: A few recent passport-sized photographs of all applicants and co-applicants

Income Proof – Salaried vs. Self-employed

Lenders want assurance that the applicant will be able to repay the borrowed loan in fixed EMIs per month. Depending on how one earns a living, there are varying documents to submit for income proof.

1. Salaried Individuals

If you have a steady job in either the private or public sector or are a member of an MNC, your income proof documentation is straightforward.

• Pay slip for the last three to six months
• Income Tax Returns (ITR) for the last two financial years along with Form 16
• Appointment Letter or Company ID Card

2. Self-employed Individuals

For self-employed people such as entrepreneurs, shop owners, professionals like doctors, lawyers and architects, or freelancers, stability and a proven income flow is what lenders want.

• ITR for the last two to three financial years with computation of income
• Balance sheets and Profit and Loss (P&L) statement audited by a Chartered Accountant
• GST registration certificate, shop establishment licence, or partnership deed

Bank Statements

No matter the job, banks are meticulous at digging through bank account history. The statement clearly reveals an individual’s cash flow, pending EMIs and spending habits.

Salaried candidates need their primary salary account statements for the last six months.

Self-employed individuals have to submit their personal bank account and business bank account statements for the last twelve months.

Property Documents

Since home loans are collateralised by the house, banks carry out thorough due diligence of the property before sanctioning the loan.

The necessary documents for property include:

• Allotment Letter
• Sale Deed
• Registered Agreement to Sell or Chain Deeds in case of a resale
• Approved Plan from municipal authorities
• No Objection Certificate (NOC) from builder/society
• Up-to-date Tax Receipts

NRI Documents

Indian citizens residing overseas wishing to purchase property in India must provide these additional documents:

• Visa and Passport copies
• Overseas employment contract
• Salary Certificate
• Three-month overseas account statements
• NRE/NRO bank statements of the last six months
• A Power of Attorney (POA)

Document Checklist

The list below should serve as a guide for quick checking.

• KYC Documents: PAN, Aadhaar Card, Passport, Voter’s ID Card
• Income Proof: 3 months’ Salary Slips, Form 16 & IT Returns for 2 to 3 years, Audited ITR, Financial Statements (Balance Sheet & P&L)
• Bank Statements: Salary Account Statements of the last 6 months; Personal & Business Account Statements of the last 12 months
• Property Documents: Allotment Letter/Sale Deed, Approved Plan, NOC
• Business Documents: GST Certificate, Business Licence, Partnership Deed

Frequently Asked Questions

1. Can I get a home loan without a PAN card?

A PAN card is crucial for all major financial transactions and is mandatory for home loans.

2. What about the documents of my co-applicant?

Yes, you absolutely must furnish your co-applicant’s documents too. If you apply jointly for a home loan, your co-applicant has to submit the complete set of their KYC documents, income proof, and bank statements.

3. My property papers have some gaps. What should I do?

The property document should be immaculate. If the sale deed is missing, the team would be forced to put your home loan application on hold until proper documentation is submitted.

You might have to obtain copies of necessary deeds from the local sub-registrar’s office.

4. What is the maximum age of utility bills used for address proof?

Your utility bills for address proof should be no older than three months from the date of application.

Final Word

Filling out such forms is always tedious, but having all the essential paperwork prepared before the home loan process begins in earnest simplifies the entire ordeal.

Keeping your documents organised and ensuring that your KYC, income, bank and property documents are complete can help make the home loan application process smoother.

If you're looking for financial assistance for your home purchase, Cholamandalam Investment and Finance Company Limited can be a smart choice.

Download the Chola One app and apply now:

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