Bank loans are easy to get especially when you are applying for a home loan. Many private and public sector banks offer the facility of home loans to individuals. Individuals can avail of bank loans from any of these banks to purchase their dream home. What is the process of procuring bank loans?

• Individual approaches the bank and requests the bank to grant him a loan to buy his home. The bank does a preliminary check on the individual’s financial profile and informs him of the amount the bank can give a loan for.


• The Individual collates all the documents required by the bank and submits it to the bank.


• The bank then assesses the documents, verifies the individual’s credit history and verifies the status of the property.


• Depending on the assessment of the documents submitted, the bank approves, rejects or puts the application on hold for other documents to be submitted.

This simple process takes banks 21-30 working days. Apply for a home loan and you may have to wait for at least this time for your loan to get sanctioned

Documents important for Banks to sanction Bank Loans

• Income proof – The individual needs to submit the last three salary slips of the company he is working for.  This is important – the individual needs to be working.  The individual can also include his wife for co-sponsorship of the loan if he wishes to.  In that case, he would need to submit the income proof of both the individuals.


• Form 16 or Tax Filing proof – The individuals would also need to submit Form 16.  Form 16 can be obtained from the company he is working with.  As a substitute, he could also submit his tax papers he would have got when he filed his taxes.


• Photo Identity proof – The individual could choose between submitting a copy of his PAN Card or a copy of his Passport


• Property Paper – Banks, may at their discretion ask for additional property papers like NOC (No objection Certificate), Municipality Clearances, FSI Clearance document and other such documents. These documents are asked on a case-case basis. Be prepared with these documents too if you are applying for Bank Loans.

Does application for Bank Loans mean my loan is approved? No, if that were the case everyone who applied for Bank Loans would have got their home loans. As per a latest survey, only 5% of all loan applications are approved.

Why do banks reject bank loans?

• Improper credit history – The banks do not find an individual trustworthy to repay their loans.  This belief is further accentuated with the individual’s credit cards and personal loans default.


• Incomplete documents – Documentation is important for banks to process a loan application.  This is also one of the reasons why banks refuse bank loans.


• Grey area or Grey property – Banks identify these properties under litigation.  Banks for do not give loans for these properties, as they are considered risky.

Now that you know a lot on availing bank loans. If you are eligible and have all your documents intact, apply for a home loan and get your dream home.