When personal finances are strained, and you need help to overcome the situation, leveraging one’s assets can be a good option. At such times, a mortgage loan comes in handy where one can offer their existing property as collateral for the mortgage loan.
Taking a secured loan like a mortgage, you can get a higher loan amount sanctioned than an unsecured loan. The repayment tenure is also much longer than a personal loan which makes it favorable for the borrower.
So once you apply for a mortgage loan and a lender sanctions it, you will need to get the loan documents ready. So let us know more about the documents required for a mortgage loan by banks or NBFC’s.
What Is A Mortgage Loan?
A mortgage loan is a secured loan that one can avail of by pledging any immovable property or asset, including residential or commercial, as collateral to the lender to avail of a loan. Current mortgage loan owners can also go for a balance transfer to better rates and lower EMI’s towards their monthly payments.
Eligibility For Mortgage Loan Sanction
Individuals eligible for a mortgage loan are salaried employees, self-employed individuals, and self-employed professionals. For salaried individuals, the applicant’s age should be more than 24 years of age at the time of applying for the mortgage loan and up to the age of superannuation.
Self-employed individuals are those who file Income Tax Returns, and self-employed Professionals are doctors, engineers, dentists, architects, chartered accountants, etc.; their age should be more than 24 years of age at the time of application of the loan and 65 years or less at the time of loan maturity.
For the Sanction letter, the bank will require your pan card, proof of identity, proof of address, Income Proof, Aadhar card, 2 years ITR, and additional documents for self-employed individuals/professionals, partnership.
The bank will evaluate your mortgage application by understanding how stable your income is, how many earning members are there in your family and the number of dependents on you.
Documents To Be Submitted For Mortgage Loan Disbursement
1. The Loan Agreement and Annexures
- Loan agreement as per product type
- Annexures to be duly filled, signed & stamped as per state law:
- MII (Most Important Information) pages
- MCLR consent letter
- Schedule of the loan agreement
- List of Documents (LOD)
- Loan restriction letter (if any)
- Disbursement request letter
- For NRIs – franked GPA document
- Indemnity for under construction cases in plot loans
- Guarantor agreement (if applicable)
2. National Automated Clearance House (NACH) mandate/ Standing Instruction (SI) form and Security Cheques (SPDC)
- NACH / SI mandate with a signed canceled cheque with A/C holder’s name as per bank records
- SPDC – 3 undated security PDCs equivalent to EMI amount
- 1 undated cheque with amount kept blank
- 1 cheque towards PEMI amount
3. Loan Cover/ Insurance Details
- Property insurance application form (mandatory)
- General insurance application form (if applicable)
- Life insurance application form (if applicable)
4. Processing Fee / Equitable Mortgage cheques
- Balance processing fee cheque (with clearance details)
- Equitable mortgage charges/stamping charges favoring the bank.
5. Property Documents
Property documents as per the type of transaction, according to the bank’s policy
6. Sanction Letter
- Duly accepted and signed by all applicants/power of attorney
- All sanction conditions to be met
As soon as you get your sanction letter, you will need to start working to arrange all these documents so that you can submit them to the lender to get your mortgage loan disbursed in your account.