First-Time Homebuyers’ Checklist: Documents Needed for a Tata Capital Home Loan

Buying a house is an important financial step for an individual. One of the most important  aspects of applying for a home loan is gathering the right documents to ensure that the  approval process is completed on time. If you are a first-time home-buyer, knowing the list  of documents that are required in a home loan application can help you take the necessary  steps. This article lists all the documents that a lender requests in a home loan  application. 

Why is Documentation Necessary for a Home Loan? 

When a borrower applies for a home loan, they are required to submit a few documents.  These documents allow the lenders to verify the borrower’s identity, income, and  repayment ability. The loan amount is sanctioned on time only if the documentation is  proper. For first-time homebuyers, the process might feel challenging, but a clear checklist  can be helpful. Let us look at the documents required for a home loan application.  

Documents for Identity Proof 

Lenders verify the borrower's identity with the following documents:
• Aadhaar Card or passport 
• Voter ID or a driver's license 
• PAN card - mandatory for most loan applications. 

Using these documents, the lender verifies the borrower’s personal details, such as their  name, age, and nationality, which are a key part of the eligibility process. 

Address Proof 

After the identity, the lender verifies the borrower’s permanent and current address. The  documents that are considered valid address proof are as follows: 
•    Utility bills such as electricity, water, or gas bills 
•    Passport or an Aadhaar card 
•    Rental agreement, if applicable. 

While submitting these documents, make sure that the address details match all the  submitted documents. This can help you avoid re-verification. 

Income-Related Documents 

Income verification is an important part of a loan assessment since it allows lenders to  assess your repayment ability. The documents required may be different for salaried and self-employed individuals. 

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Salaried individuals need to submit: 
•    Their salary slips for the past three to six months 
•    Form 16 or income tax returns 
•    Bank statements that highlight salary credits. 

In the case of self-employed individuals, the documents required are: 
•    Income tax returns for the past two to three years 
•    Audited financial statements of the business 
•    Bank statements for the past six months. 
The documents allow the lenders to understand if the borrower can manage EMI payments  throughout the loan’s tenure.

Proof of Employment 

Borrowers need to submit employment-related records to prove their income stability. In  the case of salaried applicants, an employment certificate or an official ID card may be required. Self-employed professionals may need to submit business registration  certificates or professional licences. 

Documents of Property 

When a borrower applies for a home loan, they need to submit property-specific  documents required for home loan since the property purchased is used as collateral.  These documents prove legal ownership and are used to identify whether the property is  free of disputes. Some of the common documents are as follows: 
•    The sale or title deed of the property 
•    Agreement of sale between the buyer and the seller 
•    No Objection Certification (NOC) from the relevant authorities 
•    Property tax receipts. 
With valid property documents, lenders make sure that the asset used as collateral is  legally valid and transferable. 

Photographs and Loan Application Form

Borrowers need to submit a few passport-sized photographs. Also, make sure that the  information provided in the official application form is accurate, as inconsistencies may  delay the fund disbursement process. 

Checklist for First-time Homebuyers 

Here is a checklist for borrowers who are applying for the first time.
•    Proof of Identity: Aadhaar, PAN, Passport, or Voter ID 
•    Proof of Address: Utility bills, Aadhaar, or Passport 
•    Proof of Income: Salary slips, ITR, or audited financials 
•    Employment Proof: Employer ID or business registration documents
•    Property Documents: Sale deed, building plan, NOC, tax receipts
•    Passport-size photographs and a filled application form. 

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Common Mistakes to Avoid While Providing Home Loan Documentation

First-time home buyers may face challenges due to incomplete paperwork. Some of the  common mistakes that can help them avoid challenges are as follows: 

•    Submitting expired documents, such as outdated passports or utility bills.
•    Details in the address or identity proof are not similar 
•    Missing signatures on property papers or the application form 
•    Delays in obtaining NOCs or approvals from local authorities.

By making sure that all the documents you submit are correct, you can reduce the chances  of application rejection.

Conclusion 

For first-time buyers, having a checklist of the necessary documents for a home loan  application can simplify the document submission process. These documents allow the  lender to verify the borrower’s identity, address, employment, property and the ability to  repay. Having these documents organised can improve the chances of swift approval and  reduce last-minute complications.

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