Now that financial institutions have opened up to grant every kind of loan, life has got so much simplified. Avail a loan against your monthly salary or even against property and fixed deposits and sit back for maybe ten or twenty years of ease, safe in the knowledge that life has assumed a new direction and wish fulfilling purpose. Whatever the dream throws up- home, car, land or vacation overseas, an appropriate loan would be available at around 10% interest.
Terms and conditions may vary between banks but then you have a mammoth choice between the home grown banking institutions and the foreign organizations like ICICI and Axis that have opened up shop on Indian soil.
Besides, the websites online have opened up a smart new world where you are no longer at the mercy of cabs and crooks as you travel around the maze of the city in search of the bank address that may take an hour. All the information you earlier got through an embarrassing interview or pamphlets are all there at the click of the button. Application forms are available too. The loans are rather flexible and you get to decide the loan amount, the repayment options and the duration. The online EMI calculator would help.
The first step of course would be establish your identity with several documents that must include the picture documents and the address proof. The Know Your Customer policy lists a whole range of documents but the most common are the passport, PAN card for financial dealings and the Voter Card. All of them contain images of the client.
The greatest advantage of such loans especially for the salaried class with regular incomes would be to plan and organize your life for the future. Once a structure is achieved for the duration of the loan that may be twenty years, you can plan your finances accordingly. Regarding the banks themselves, there is little to worry about with the nationalization having taken place and the reputable foreign institutions too.
Which bank would you eventually decide upon? You could make a beginning by discussing with family and friends besides the office staff and get a reference or two that is usually how it works. Attempt your own research too by carefully studying all the literature available online until it begins to make sense slowly. If you belong to a club or association, maybe social networks online, you might receive some valid recommendations.
The second major issue would be to identify the dream home and make sure that there exist no legal liabilities on the path to your success. Take time to discuss with several authorities including the real estate and the legal and research several options. Documents have to be demanded and verified especially those concerning the previous owner and receipts of taxes paid particularly in the case of resale properties. If it is a new construction, you would probably wait a few years before the time for occupancy arrives with the inevitable delays. Expenses finally always add up well beyond the initial estimate and you need to be prepared and act accordingly in financial terms.
A lot of people avail loans though they have the ability to make the lump sum payment out of their existing accounts. That does not make sense when you consider the fact that you would be paying at least 10% interest on the loan amount. You would have to make the final decision though. Of course we do realize that the pinch of making that huge payment at once can be avoided through the loan. Besides, many have lingering doubts about the property being purchased and so the risk is spread out if you opt for payment in installments. Time of course will gradually reveal the truth.
The paper work and the documents to be provided in case of security or if the loan is availed against property can be extensive. Make certain that you are up to date with documentation with all liabilities cleared and taxes paid. Make sure that you maintain a secure file for the purpose with originals and photocopies ready for examination and evaluation. As far as possible, original documents must not be submitted.
The granting of the loan may not take long if all the documents are in order with no legal loopholes. A long journey to usher in a new phase of your financial life with the dream home in sight has begun. You may already occupy the house and you need to live with the loan for many years to come. Let the loan not feel like a noose around the neck but a necessary financial liability. Meanwhile enjoy the ride we call life.