Buying a home is a major decision for everyone and for many it is one of their life’s biggest objectives. It usually involves a substantial investment on part of the buyer. As a result, right from choosing the most suitable place to obtaining the necessary finances- everything needs to be done properly.
Every prospective buyer on the verge of applying for a home loan should be comprehensive in their research. They should find out how to check home loan eligibility and ensure they qualify. Getting information on home loan interest rates is equally crucial. Buyers should also get to know about the category of homes eligible for loans as determined by Banks, NBFCs and housing finance companies.
Different lending institutions have their well-defined internal benchmark for approval and disbursement of loans. However, some parameters for exclusion and inclusion of homes under the approved category for loans are common to all. In this article, we will tell you about the various ineligible and eligible categories of homes for loans.
Let’s take a look at the things you need to check about your builder home before you apply for loans.
- Approval by Real Estate Regulatory Authority (RERA)- After the Real Estate (Regulation & Development) Act of 2016 came into force, it has become mandatory for builders to get all their projects approved by the RERA. In case, your home isn’t RERA validated, getting a loan for it would be extremely difficult.
- Municipal Corporation/ Development Authority certification- You must keep in mind that all constructions in cities/ towns require certification of the building plan by the local Municipality or Development Authority. Hence, before you purchase a home and think about applying for loans, you must ensure that it’s building plan/ map has been approved.
- Reputation of the builder- The track record of builders in terms of project completion and adherence to all relevant rules and regulations matters a lot. Builders who are affiliated to CREDAI or Builders Association of India must be
Homes outside the eligibility criteria
All prospective home buyers who will initiate the purchase on the basis of home loan should be aware of home categories for which loans are not approved by lending institutions. In general, Banks, NBFCs as well as housing finance companies do not approve loans for the following types of homes.
- Property being sold on the basis of Power of Attorney (POA)
- Property being sold by Gram Panchayat
- Abadi Properties & Lal Dora Properties
- Properties with ownership disputes
- Property sold by unlicensed builders
- Homes built in contravention of approved building plan
Taking into account these facts will help you make the right decision and get seamless approval for your home loans.
We, at New Delhi Financial; work with almost all lending institutions and will be able to guide you to choose a property before / at the time of purchase which on which loan can be availed.
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