A home loan offers adequate finance to purchase one’s dream abode. Apart from visiting the lender’s branch to apply for the loan, you can make an online loan application and get an online home loan approval. Some financial lenders offer instant home loan approval if you make an online loan application.
Apart from the regular home loan, a pre-approved home loan is also a good way of acquiring the necessary funds for purchasing your dream home.
About Pre-Approved Home Loan
In a pre-approved home loan, an in-principle sanction is given by financial institutions to prospective homebuyers for a specific loan amount before they finalise the property. These loans are predominantly based on your repayment capacity. To get a pre-approved home loan, you don’t need to submit property papers. The lenders will ask you to submit mandatory documents like income tax returns, bank account statement, income proof, PAN card details, etc. Lenders will also look into your CIBIL report to check your credit history. The pre-approved home loan is valid up to a certain period only and the financial institution provides a stipulated period after the approval to finalise the property.
Benefits of Pre-Approved Home Loans
- Focused house hunt
Once your loan is approved, you’ll have a clear idea of the amount you can get. Knowing your budget will allow you to limit your search and focus on the properties falling in the budget category. This becomes time-saving as you won’t be considering the properties, not in your budget. Furthermore, as the financial institution gives you a stipulated time, a focused search can help hasten the house-hunting process.
- Helps in negotiation
A pre-approved home loan assures the seller that you have the financial means to close the transaction. The stipulated time frame will also let the seller know that you don’t intend to drag out the process unnecessarily and would want to complete the deal quickly. Thus, this will put you in a better position to negotiate with the sellers. Moreover, the sellers will also be willing to offer discounts or additional benefits so that the deal is completed. Furthermore, the seller will also treat you more seriously, compared to other prospective buyers.
- Quicker loan disbursal
As a chunk of the verification is done during the pre-approval stage, the financial institution only verifies the property documents and gives the final approval. This means the home loan disbursal becomes quicker once you have finalised the property. This becomes helpful for homebuyers who have a time limit attached to their transaction for purchasing their homes.
- More planned finances
A pre-approved home loan makes you aware of your financial standing. You get to know how much you have and how much you have to borrow. This allows you to plan your savings and make a down payment accordingly.
- Ease in repayment
As the specific home loan amount is decided based on your repayment capability, it means that you can conveniently pay it off without having to face any financial strain on your monthly budget. This proves to be less burdensome for you.
Whenever applying for a home loan, it is best to use a home loan eligibility calculator so that you know the amount you are eligible to borrow. When searching for a home loan, head to any financial institution providing reasonable home loan interest rates. Before going for the loan, check your home loan eligibility.
Once you have checked your home loan eligibility, apply for a loan online and get an online home loan approval!
Hemant Kumar is a project manager at Tridindia with more than nine years of commendable experience in writing about LMS, translation, and IT. His unmatched talent and passion for digital marketing gave him the opportunity to work as a multi-tasking project manager at TridIndia’s sister company, Link Building Corp. Today, he contributes to the world by imparting knowledge on SEO, link building and internet marketing etc., that helps business owners grow their online business.