(The Complete Guide For Mortgage Loan)

A loan provided by pledging your property as collateral with lender Banks/NBFCs is called a mortgage loan. Since the property is taken as a security to provide a loan it falls under the category of secured loans. Mortgage loans are also referred to as “Loan Against Property”. The interest rates on mortgage loans range from 8.75% to 11.50% p.a.

A loan provided by pledging your property as collateral with lender Banks/NBFCs is called a mortgage loan. Since the property is taken as a security to provide a loan it falls under the category of secured loans. Mortgage loans are also referred to as “Loan Against Property”. The interest rates on mortgage loans range from 8.75% to 11.50% p.a.

With the series of repo rate and reverse repo rate cuts announced by the RBI to mitigate the effects of pandemic coronavirus, the lending rates of the banks got altered touching a new all-time low of 10 years. The revised mortgage rates of the top banks are given below. 

 RBI’s Announcement On Financial Aid To Combat Covid-19

Comparison For The Best Bank For Mortgage Loan 

Interest rate offered is the primary factor for comparison of Mortgage loans. It has a direct impact on your EMI paying capacity. Apart from the interest rates the other key factors you must compare to find the best bank for mortgage loan includes:

• Processing Fees (PF) and Other relevant charges
• Processing time for loan
• Documents required
• The LTV funding norms. (LTV-Loan to value)
• Pre & part payment conditions and its charges
• Other services provided

CLICK to know the best bank for a mortgage loan.

Compare Mortgage Loan Interest Rates Of Top Banks

Bank	Home Loan Rate Of Interest (Min)	Home Loan Rate Of Interest (Max)	Processing Fees	APPLY NOW
ICICI Bank	9%	11%	0.50%-1% of the loan amount + applicable GST.	APPLY NOW
HDFC	9.10%	11.50%	0.50%-1% of the loan amount + applicable GST.	APPLY NOW
Piramal Housing	10%	13%	0.50%-1% of the loan amount + applicable GST.	APPLY NOW
Axis Bank	9.50%	12%	0.75%-1% of the loan amount + applicable GST.	APPLY NOW
CITI Bank	8.75%* – Cases above 50lakhs- For self employed   9.50%	10.50%	0.25% – 1% of the loan amount + applicable GST.	APPLY NOW

Note: The interest rates and the processing fees mentioned in the chart are subject to change anytime without any prior notice.

Which Bank Is Providing The Lowest Interest Rate On Mortgage Loan?

As per the given rate chart ICICI Bank is giving the lowest interest rate of 9% followed by HDFC @ 9.10% for all eligible loan borrowers i.e. both salaried and self-employed irrespective of the loan amount. Although the Citi Bank’s interest rate of 8.75% is competitive but the rates are non-applicable for salaried loan borrowers and there is also a capping minimum requirement of loan amount i.e. applicable only for 50lakhs and above. The Covid -19 pandemic has made a strategic impact on the Indian mortgage industry which has reduced the interest rates to touch an all-time new low of 10years. 

Total Cost For Applying A Mortgage Loan

Besides the processing fees and the applicable GST, there are various other charges that make the total cost of your mortgage loan. Below given is the total cost involved in applying a mortgage loan:

1) Processing Fees (PF): PF is a charge taken by the banks for processing your loan. The processing fees on mortgage loans range from 0.25%-1% on the loan amount.

2) GST: 18%. Applicable on all banking charges such as PF, administrative cost, legal & technical, CERSAI, pre & part payment, etc.

3) CERSAI: Central Registry of Securitisation Asset Reconstruction And Security Interest cost of Rs.100/- is mandatory for all loan borrowers. It is Indian central online registry of equitable mortgages, mainly created to check fraudulent activities in lending against equitable mortgages.

4) Administrative Charges: One time non-refundable charge collected by the bank to recover the administrative cost for processing your loan. It varies from bank to bank, and ranges from Rs.3,500 – Rs.6,000/-.

5) Legal & Technical Charge: Legal charge for scrutinizing your property documents such as agreement & prior chain of agreements, title flow, title search, etc. and technical charge to determine the valuation of your property, vary from bank to bank and ranges from Rs.5,000 – Rs.10,000/-.

6) Registered Mortgage (RM): A charge created on the property with the sub-registrar through a formal written process, as a proof of transfer of interest to the bank. RM charges are 0.50% on the loan amount. If RM is done you do not have to pay the stamp duty charges.

7) Franking Charge: Varies from state to state and range between 0.10% – 0.20% on the loan amount.

Best Bank For Mortgage Loan

If you are unable to decide which is the best bank for a mortgage loan, here is a quick guide for you.

Although rate of interest remains the primary factor for comparison of the best bank for mortgage loan; total costs involved, eligibility as per income and as per the market value of the property i.e. the LTV (Loan To Value) criteria, list of documents required, services provided, etc. are yet other factors which are equally important for making a comparison.

• If you are looking for quick services and faster disbursement of loans along with low interest rates, ICICI bank can be a better choice. Apply for ICICI Bank.
• If you are self-employed looking only for lowest interest rates, Citi bank can be a better choice.
• If you are an NRI and want to mortgage your residential property, ICICI bank is the best option. (No other banks provide NRI mortgage loans.)
• If you are a senior citizen above the age of 60years looking for funds to take care of your daily livelihood and medical expenses, Canara bank is best for you to apply for a reverse mortgage loan.
• If you are looking for a pre-sanction loan without taking the upfront heavy cost of processing fees, HDFC can be a better choice – pay only a nominal fee of Rs.5000/- . Apply for HDFC Bank.

How To Get The Best Deal On a Mortgage Loan? 

The banks offer concessions in the interest rates, processing fees, repayment tenures, increased eligibility, etc. only after carefully studying your eligibility, credibility, employment details, legal and technical analysis of your property, etc. the higher the risk you pose to the bank the lower are your chances to negotiate with the banks. Only when the bank is certain of your repayment capacity you can bang the best deal on a mortgage loan. The factors affecting the bank’s decision to provide you concessional rates and discounted charges depends on the estimation of high & low risk involved in funding the loan. These factors are as follows:

1) Your Profile: Well designations, employed in reputed organizations, professionals such as doctors, engineers, architects, chartered accountants, etc. remains the first priority for the banks to fund as they pose minimum risk to banks and the banks are assured for their loan repayments.

2) Income Eligibility: The equation says, the higher is your income the less are your chances to default the loan. Also your uninterrupted regular flow of income with subject to the obligations if any, poses minimum risk to the banks in funding you. 

3) Repayment History: Your previous loan obligations, repayment records i.e. timely repayment of EMI with no delayed payments, pre-closure of loan before its due date, etc. are the signs of your good repayment track records which are considered important while calculating the risk factor. Your repayment record will give assurance of your timely repayment of loan.  

4) Existing Relationship With The Bank: Your existing relationship with the banks puts you in a better deal to capitalise rates and charges for your new requirement of mortgage loan.

5) Property Valuation: When your loan requirement is minimum against the high value of the pledged property, your LTV percentage is minimum and your chance to secure a low cost mortgage loan is high because of low risk to the banks. 

CLICK to bang a best deal on mortgage loans. 

Mortgage Loan Details

A mortgage is a type of secured loan given against the collateral of an asset i.e. the property which is either residential or commercial or industrial. Anyone who is above 21years and is having a regular flow of legal income and is having a property registered in his name along-with the proper income and property documentation can apply for a mortgage loan. Both eligible salaried and self-employed can apply for a mortgage loan to meet their personal requirement for funds. A mortgage loan can be taken to fulfill your immediate and urgent requirement of funds. Since the mortgage amount is utilized to meet your many personal requirements, banks keep their margins high in mortgage lending rates and therefore the rate of interest in mortgage loans is high in comparison to the rate of interest in home loans.

Purpose For Applying Mortgage Loan

Since a mortgage loan is cheaper in comparison to other unsecured loan to fulfill your immediate requirements of funds, it can be applied to fulfill your purpose of:

• Home renovations
• Home repairs
• Home construction
• Children education
• Child marriage
• Investment in property
• Medical emergencies
• Business expansions
• To close other unsecured loans
• Clear credit card dues
• Etc.

However the end-use for applying a mortgage loan has to be clear and specific. Banks do not lend to meet your unjustified end-use purposes, such as, investment in stocks, mutual funds, purchasing a chawl property, purchasing a pagdi property,investing in illegal raw houses, money lending business, etc.

You also get a choice to select a suitable interest rate for yourself. The interest rates in mortgage loans can either be fixed or floating.

1) Fixed Interest Rate:- In fixed interest rates, your mortgage interest rates remain fixed for the loan tenure or for the portion of the loan tenure as stated in the bank’s agreements. The fixed tenure and the interest rate varies from bank to bank. You can switch from a fixed rate to a floating interest rate any-time after the completion of the fixed tenure.

2) Floating Interest Rates:- In floating interest rates, your mortgage interest rates are not fixed and fluctuate according to the updated base rate of the banks. The floating rates are cheaper than the fixed interest rates and since they keep on varying i.e. fluctuating they are also referred to as variable or fluctuating interest rates.

Mortgage Loan Criteria

Eligibility: A borrower with regular flow of income and within the age group of 21 years to 70 years. For salaried the age limit is 21yrs-60yrs and for self-employed the age limit is 21yrs-70yrs.

Loan Amount: The loan amount ranges from Rs.10lakhs to Rs.20crs.

Security: An ownership residential, commercial or industrial property is taken as collateral for providing the mortgage loan.

Loan To Value (LTV): Varies from 60%-70% on the market value of the property. The LTV ratio differs by type of property. For residential & commercial property LTV is 60%-70% and for industrial property LTV is 50%-55%.

Loan Tenure: Ranges between 5years – 20years.

Interest Rates: The new home loan interest rates starts from 8.75%. The interest rates of the various banks range from 8.75% – 13%.

Processing Fees: Vary between 0.50%- 1% on the loan amount + applicable GST.

Other Charges: Legal charges, technical charges, administrative charges, franking & stamp duty charge, intimation to mortgage charge, etc.

Foreclosure Charges: Vary between banks and are 2% – 5% on outstanding loan amount.

CIBIL Score: Requires good CIBIL score of 750 and above.

Mortgage Loan Products: Simple mortgage loan, floating rate mortgage loan, fixed rate mortgage loan, mortgage overdraft, mortgage loan balance transfer, mortgage loan top-up, reverse mortgage.

Documents Required: Identity proof, Address proof, Income proof and Property papers.

Which Properties Are Considered For Mortgage Loan

The property has a vital role in mortgage loan, as it is the only asset which is pledged as collateral to obtain the loan. Therefore it is important you understand a property in mortgage loan against which a loan can be drawn.

Highlighted below are the important aspects of the property.

• Only residential, commercial or industrial ownership property, self owned, jointly owned or a parental owned property can be considered for mortgage loan.
• Property’s registration and stamp duty must have been paid.
• The age of the property is important to ensure the maximum loan tenure. Structural audit report is mandatory for properties with more than 50years.
• The market value of the property is important to determine loan to value i.e. LTV.
• OC, CC & Plan Copy along with index 2 are the mandatory property documents along with the prior chain of agreement.
• Property tax is mandatory for mortgage in the event of absence of OC & CC + plan copy for properties which are more than 25-30years of old.
• If the chain of agreement is missing or lost, an FIR copy with public notice is mandatory along with the no claim letter to mortgage the property.
• The property must have a clear and marketable title.

Properties that cannot be mortgaged includes:

•  Illegal property.
• Third party ownership property.
• Row houses or chawl properties.
• SRA properties less than 10 years old.
• Pagadi property.
• A property with notarized agreement.
• Government allotted quarters.
• Rented property.
• A property ownership transferred through a gift deed where stamp duty and registration is not paid.
• Old buildings where the age of the property has expired. And no structural audit report is available for the property.
• MHADA/CIDCO/MMRDA/ or other government property having a clause in its agreement for “non-saleable or mortgage of the property title”.
• Property falling under the negative area list of the banks.
• A property with incomplete documentation, whose property papers are missing (lost, misplaced, stolen or damaged).
• A residential property converted for commercial use having no BMC approval and no commercial property tax is paid.
• A property which does not qualify the minimum sq ft requirement criteria of the banks.
• A property with suit filed on it.
• Grampanchayat property.

NOTE:

• Some banks may consider pagadi property as a supportive property to your primary property which is to be mortgaged in order to increase your loan eligibility. In such a scenario market value of both the properties will be considered for calculating the LTV.
• Only some NBFCs do grampanchyat mortgage loans.

Important Highlights On Mortgage Loan

• All property co-owners have to be the co-applicants in the loan.
• If the property is in parental name and you as 1 of the siblings wish to apply for the mortgage loan, it is mandatory to obtain the NOC, from the rest of the siblings.
• Many private banks have criteria for minimum requirement of sq ft area of the property for providing mortgage loan.
• An 1 bhk residential property jointly owned by two siblings is not considered for mortgage by many private banks.
• Mortgage loans cannot be availed in negative industries such as private lending firms and negative profiles such as financiers, private lenders, stock market investors, etc.
•  A mortgage loan amount cannot be utilized for trading and investments in stock markets, mutual funds, buying a chawl property, for start-up businesses, etc.   

Types Of Mortgage Loans

There are mainly 6 types of mortgage loans.

1) Simple Mortgage: It is a traditional mortgage loan where you pledge your property to get the desired loan amount. Your income, age, profile, obligations, employment, property value, etc. are some of the important factors considered to calculate your mortgage eligibility. In simple mortgages you can choose the best suitable interest rate for you and accordingly your mortgage loan will be:

1. Fixed interest rate mortgage loan- where your interest rates remain fixed for the loan tenure or for the portion of the loan tenure.
2. Floating interest rate mortgage loan- where your interest rates are not fixed and fluctuate according to the latest lending rates/base rate of the banks. The interest rates automatically get revised with the changes in the base rates of the banks.

APPLY for Mortgage Loan @ 9%

2) Mortgage Overdraft: A loan amount which is given in the form of an overdraft facility is called “Mortgage Overdraft”. It is a new mortgage product introduced in the recent past to meet your working capital requirement. It is therefore suitable for businessmen or professionals who have fluctuating requirements of funds throughout the year. Businessmen include self-employed- proprietor, partner of the partnership firm, director of the public and private limited company, entrepreneur, freelancer and professional such doctors, engineers, chartered accountants, etc. Similar to simple mortgage, mortgage overdraft is also provided against the pledge of the property but with an overdraft facility wherein you are required to pay interest only on the borrowed loan amount. There are no restrictions on the pre & part payments of the loan, and therefore the interest rates for mortgage overdraft are 1%-2% higher in comparison to a simple mortgage loan.

CLICK to get complete information on mortgage overdraft.

APPLY for Mortgage Overdraft @ 9.50%

3) Mortgage Loan Balance Transfer: You can transfer your high interest rate mortgage loan to a low interest rate mortgage loan with another bank. This process of transferring a loan from one bank to another to enjoy the benefits of interest rates, longer repayment tenures and to apply for additional top-up loan is referred as mortgage loan balance transfer.

Check out the list of documents required for balance transfer CLICK.

CLICK to APPLY for Mortgage Loan Balance Transfer @ 9.50% 9% & 0.50%Processing Fees   

4) Mortgage Loan Top-Up: Top-up loan means borrowing additional loan to your already existing mortgage loan. It is the easiest and the fastest way of receiving funds for meeting your immediate requirements. Your top-up eligibility is subject to your income eligibility and to the market value of your property. For your top-up eligibility against property the total amount of your top-up loan & existing outstanding on mortgage loan should not exceed the LTV percentage of the bank i.e. 60%-70%. Top-up loan is offered at the same rate of your existing mortgage loan or varies between 0.10%-1% above your existing mortgage rate depending upon bank to bank. The processing fees to apply for a mortgage range from 0.25%-1% on the top-up amount.

APPLY Mortgage Top-Up Loan @ Lowest Rate Of 9%

5) NRI Mortgage Loan: An Indian citizen or foreign national of Indian origin residing outside India for the purpose of employment or business is referred to as NRI. An NRI having a residential property in India can apply for a mortgage loan in India. There is only one bank i.e. ICICI Bank which provides mortgage loans for NRIs provided the NRI is salaried working in the countries other than Iran, North Korea (Democratic People’s Republic of Korea), Cuba, Syria, Sudan, and Cremia Region of Ukraine, Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Nepal, Macau, Hongkong or Bhutan. A self-employed NRI is restricted from availing the benefits of mortgage loan in India as per the Indian funding laws.

Checkout the NRI Mortgage Loan List Of Documents

6) Reverse Mortgage (RM): Since the regular mortgage loan has an age criteria to apply for a loan i.e. up-to 70 years, the concept of reverse mortgage was introduced to allow the senior citizens above the age of 60years to avail the benefits of mortgage loan. In reverse mortgage senior citizens can avail regular/periodical payments from the bank against the mortgage of their house while still retaining the ownership of the house and occupying the same. However the minimum residential life of the property should not be less than 20 years. The interest rates in Reverse mortgages could either be fixed or floating determined by the prevailing market interest rates and may vary from bank-to bank. There are no monthly EMIs and the loan amount along with the interest accrued on the loan amount gets repaid after the death of one of the survivors of the loan application.

Read more on reverse mortgage on – REVERSE MORTGAGE- Loan For elderly

Mortgage Loan Eligibility

You can check your eligibility for the best banks based on your income, age, current obligations, property valuation and LTV. The FOIR i.e. fixed obligation against income ratio for calculating your income eligibility in mortgage loan is considered at 40%-60% of the monthly net income or net profit for both salaried and self-employed borrowers. For higher loan eligibility you can add an earning co-applicant / co-applicants to your loan application. Maximum upto 6 members can be added as co-applicants to the loan. A co-applicant has to be in your blood relation – he can either be your spouse (husband or wife), children (son or daughter), parents (father or mother) & siblings (brother or sister). You can also enhance your loan eligibility by adding your additional sources of incomes such as, perks, incentives, bonus, gratuity, arrears, paid leaves, rental income, agricultural income, self-employed cash income properly maintained in the registers of and reflected in the ITR, net income and profits of all the businesses of the self-employed, pension income, etc.

The other factors equally important to determine your eligibility are your CIBIL score, past repayment history and track records, your total work experience, income history & stability, job continuity, employment industry, your total assets & liabilities, etc. High CIBIL score and stable jobs/ incomes improves the chances of your loan approval with the banks.

How To Increase Your Mortgage Loan Eligibility

• Add your legal income from other sources.
• Add an earning co-applicant to the loan.
• Go for maximum loan tenure.
• Mortgage a property with higher market value.
• Apply with a bank with lowest interest rates.
• Foreclosing your other obligations such as car loan, personal loan, business loan, consumer loans, credit cards, etc.

Formula for calculating your mortgage loan eligibility

{[Net income per month X FOIR %(40%-60%)] – Obligation OR Deductions} ÷ Per lakh EMI subject to market value of the property i.e. LTV

LTV – Market Value of the property X (50%-70%)

The lower figure between the two- i.e. income eligibility and the LTV factor of the property, will be the final home loan eligibility of the home buyer.

(FOIR means fixed obligation to income ratio, LTV means loan to value, Obligation Or deductions means EMIs of other loans if any.)

CHECK YOUR ELIGIBILITY

Mortgage Loan EMI Calculator

With a mortgage EMI calculator check your EMI easily at a single click. Calculate how much EMI you can comfortably pay with the help of the EMI calculator. The EMI is dependent on three important factors i.e. principal borrowings, loan tenure and the rate of interest, therefore enter these details on the EMI calculator, and know your EMI alongwith the interest payable to the bank.

Benefits of using online EMI calculator

• The EMI calculator exactly shows how much EMI you will pay as your monthly loan instalments.
• It also shows the total interest payable on the loan amount.  
• Calculating EMI using manual EMI formula is complex. It increases your chances for wrong calculations and wrong selection of banks. 
• By calculating the EMIs in seconds, it saves your precious time.   
• You can compare multiple EMIs with different loan tenures and interest rates and choose the one that is within your budget.

CALCULATE YOUR EMI

Know the best mortgage loan interest rates, mortgage loan in Mumbai, mortgage loan eligibility and compare mortgage loan of various banks online on a single platform on https://www.loanfasttrack.com/. It is a user friendly platform providing detailed information, comparison and evaluation on the mortgage loan process, documentation, eligibility, ongoing offers and key factors such as interest rates, processing fees, LTV, etc. of the top banks just at a single click.

Mortgage Loan Process

The loan processing is always a time consuming process and it takes nearly 15-20 working days to get the loan amount on submission of required documents. Below mentioned is the step by step process to help you apply for a mortgage loan.

Step 1: Choose the best bank for a mortgage loan to apply with. Use our online portal https://www.loanfasttrack.com/loan-against-property.html, to compare and evaluate the bank and its offers relating to interest rates, processing fees, LTV, tenure, etc. 

Step 2: On finalizing the best bank, submit your application for the desired loan amount by filling your contact details such as name, contact number, email address & location on https://www.loanfasttrack.com/mortgage-loan/apply-online-now.html.

Step 3: On successful submission of application, receive a call from expert advisors for further tele-discussions of your mortgage requirements.

Step 4: The expert will collect the necessary information on your income, employment, property, occupation, obligation etc. to calculate your loan eligibility and will provide you with best offers from the top banks. You can select the best suitable offer. 

Step 5: The experts will send you the mortgage loan checklist for the chosen bank. The checklist contains your KYC, income documents and property papers.Please refer to the following links for the mortgage loan documentation.

For Mortgage Loan – https://www.loanfasttrack.com/blog/blog/finance/mortgage-loan-list-of-documents-for-salaried-customers/

For Mortgage Loan Balance Transfer – https://www.loanfasttrack.com/blog/blog/finance/document-checklist-for-mortgage-loan-balance-transfer-for-salaried-customers/

Speak to a mortgage loan expert on 9321020476

Step 6: A relationship manager (RM) will be assigned to you who will be your one point of contact for the loan application. The RM will visit you personally to collect the documentation and to sign the mortgage loan form. Cheques towards the processing fees, legal and technical charges will also be collected at the same time.

Step 7: The duly signed form along with the required set of documents will be submitted to the bank for sanction process. The estimated time for loan sanction is 5-10 working days. Property legal and technical (property valuation) will be initiated within these 5-10 working days. The sanction process involves scrutiny of your submitted form and documents, CIBIL check, RCU (Risk Containment Unit) verification for any fraudulent and forged documents, FI (Field Investigation) visits at your residence and office, personal discussion with the credit manager.  

Step 8: The legal and technical verification of the property will be done. A physical inspection of the property will be carried out to ascertain its current market value, age and technical deviation to be sure that banks do not over-lend the cost of the property. A legal scrutiny of the property papers is done to be sure of the clear and marketable title of the property.

Step 9: On satisfactory results of the above your loan will be approved and you will be issued the copy of the approved loan i.e. the mortgage loan sanction letter. You are required to then submit the original property papers with the bank along with the disbursement kit duly signed for your loan disbursement process. The disbursement is the process of another 5-10 working days.

Step 10: The disbursed loan amount will be transferred to your banking account through NEFT or RTGS or by issued cheque for the disbursed loan amount

Documents Required For Applying Mortgage Loan

As mentioned above, a mortgage loan processing comprises of three processes:

a) Sanction process

b) Legal & Technical process

c) Disbursement process.

Below mentioned are the list of documents required for all the 3 processes of mortgage loan for both salaried and self-employed.

a) Documents required for sanction process

Salaried Documents

KYC

1. Pan card copy of all applicants.

2. Latest passport size colour photographs of all applicants.

3. Residence proof – Copy of Aadhar card & electricity bill.

Financial Documents

1. Latest 4 months salary slips.

2. Latest 2 years form 16.

3. Latest 6 months salary account statements.

4. Latest 1 year bonus copy.

5. For rental income receivable:

1. Copy of registered rental agreement.
2. 12 months latest rental credit statement.

6. For agricultural income receivable: latest 2 years ITR copy reflecting the agricultural

    Income.

7. For employment change:

1. Copy of joining letter/ appointment letter/ offer letter of the new company.
2. Copy of resignation letter.
3. One month salary credit in a bank account.

Other Documents

1. Bank form duly signed and all applicants.

2. Processing fee cheque in favour of bank.

Self-employed Documents

KYC

1. Pan card copy of all applicants.

2. Latest passport size colour photographs of all applicants.

3. Residence proof – Copy of Aadhar card & electricity bill.

Financial Documents

1. 3 years latest financials of the applicant with Saral Copy, Balance Sheet, P&L account, Capital Account – CA certified with membership no. & USDIN no.

2. Latest 3 years Form no-26 AS.

3. Latest 1 year Copy of GST returns – 3B form.

4. Latest 12 months bank account statement of the current account (if any).

5. Latest 12 months bank account statement of all savings accounts.

6. For rental income receivable:

• Copy of registered rental agreement.
• 12 months latest rental credit statement.

7. CA certified debtors and creditors statement aging for 1 year.

Other Documents

1. Business profile on the letter head of the company.

2. Business proof – GST registration, Ghumastha or Copy of Aadhar Udyog.

3. Copy of contract letter if any.

4. If self-employed is :

1. Chartered Accountant – copy of COP & passing certificate.
2. Doctor – copy of degree certificate.

5. Processing fee cheque in favour of bank.

6. Bank form duly signed and all applicants.

Additional Documents Required For The Balance Transfer Of Mortgage Loan:

7. LOD (list of documents) from the existing loan bank.

8. Repayment track record for 18 months.

9. Outstanding letter copy from the existing loan bank.

b) Documents Required For Legal & Technical Process

For Salaried and Self-employed

1. Copy of prior chain of agreements.

2. OC / CC + approved plan copy.

3. Copy of index 2.

5. Copy of latest property maintenance bill.

6. Copy of share certificate.

7. Copy of society registration certificate.

8. Copy of latest property tax receipt.

c) Documents Required For Disbursement Process

For Salaried and Self-employed

1. Original copy of prior chain of agreement with stamp duty duly paid & registration done along-with index 2.

2. Copy of Occupancy Certificate/CC + approved plans.

3. Original share certificate – if issued.

4. NOC from society duly signed by chairman & secretary- if society is formed.

5. Noc from builder – if society is not formed.

6. Copy of Society registration certificate.

7. Latest copy of property tax receipt.

8. For CIDCO/MHADA Property

1. Copy of conveyance deed, original NOC & transfer letter from CIDCO/ MHADA – if conveyance deed is executed.
2. Copy of tri-party agreement & lease agreement – if conveyance deed is not executed.

9. Title search report of the property.

10. Structural audit report of the property for properties more than 50years old.

11. Any other documents:

1. As per the Legal report of the property.
2. As per the sanction condition.
3. As demanded by the credit managers.

12. 7-Security mandate cheques in favor of BANK.

13. Docket kit duly signed by all applicants.

Common Reasons Why Your Mortgage Loan Gets Rejected

The reasons for rejections are case specific but the common reasons for rejections are:

• Not qualifying for the loan.
• Your income eligibility.
• Age criteria.
• LTV constraints on the property funding.
• Negative profile, negative industry or negative business.
• Negative FI (field investigation) visit.
• Your low CIBIL score.
• Low CIBIL score of the co-applicant/ co-applicants.
• If you are a frequent job hopper.
• If you are a loan defaulter.
• Black listed property, project, area, builder or developer.
• If you are an NRI working in countries such as Pakistan, Afghanistan, Nigeria, Bhutan, China, Nepal, Bangladesh, Sri Lanka,Iran, North Korea (Democratic People’s Republic of Korea), Cuba, Syria, Sudan, and Crimea Region of Ukraine, Macau, Hong Kong.
• Legal issues in property such as suit filed, unclear title, property not registered, stamp duty not paid, no ownership rights, etc.
• Technical issues in property such as property valuation, illegal construction, illegal extensions, property age, etc.
• Misplaced, missing or property papers lost.
• Processing fees cheque bounce. Having insufficient balances in all subsequent bank accounts for processing charges. 
• Loan end-use is not justified.

You need to be careful when applying for a mortgage loan. Multiple rejections of your loans from the banks carry a negative impact on your CIBIL history thereby hampering your CIBIL score.

Dealing With Increasing Interest Rates

Many times you come across a situation where your rate of interest keeps increasing and at times your rate of interest does not reduce despite the reduction in the lending rates of the banks. (Lending rates of the banks fluctuates to the fluctuations in the repo rates announced by the RBI.) While the hike in the interest rates is immediately implemented by the banks, the implementation of reduced interest rates are often delayed and at times aren’t transferred unless you pay a conversion cost to convert your high interest rate mortgage loan to a low interest rate mortgage loan.

With changing economic conditions and inflation in the country the Reserve Bank of India keeps altering the repo rates for the banks, which further alters the lending rates of the banks that further fluctuates your mortgage interest rates. So if your interest rates remain unchanged irrespective of the reduction in the interest rates by the banks, it probably is a time for you to transfer your mortgage loan to a new bank with low interest rates on mortgage loan. Switching your bank will also benefit you from availing, longer repayment tenures, top-up facility with increased loan tenures, opportunity to shift to a fixed interest rate mortgage loan, improved & satisfactory services of the new bank, etc. However to be able to balance transfer your mortgage loan you need to have a proper repayment history of your EMIs. Timely repayment of your loan EMI, no delayed payments, no EMI bounces forms a strong base for your balance transfer which also gives you an upper hand to negotiate with the banks on interest rates and processing charges.

Reduce your interest rates CLICK to APPLY for a Mortgage Loan Balance Transfer @ 9%.

Mortgage Loan FAQ

What is a mortgage loan?

A loan provided by a financial lender i.e. by bank/NBFC against the collateral of your property which can be residential, commercial or industrial is called a mortgage loan.

Who can apply for a mortgage loan?

An eligible individual who is either salaried or self-employed or professional with regular flow of income can apply for a mortgage loan. A company- proprietorship firm, partnership firm, private limited, public limited can also apply for a mortgage loan. 

What are the current interest rates for mortgage loans in India?

Present interest rates for mortgage loans in India range between – 8.75% to 13%.

What is the turnaround time for loan processing?

Total turnaround time for processing a mortgage loan takes 10-20 working days.

• Sanction process takes 5-10 working days.
• Disbursement takes 5-10 working days.

What is the maximum loan tenure I can get?

Your mortgage loan tenure largely depends on your age and the age of your property. However the maximum loan tenure banks provide is for 15 years, while some banks also provide upto 20 years.

How much mortgage loan can I get?

There is no upper ceiling limit for taking a mortgage loan. It is subject to your income eligibility and the market value of your property.

What is the total cost for taking a mortgage loan?

You are required to pay all banking charges and government charges before taking the disbursement of the mortgage loan.Processing fees (0.25%1%), legal & technical charge (Rs.5000-Rs.10,000), franking charge of 0.10%-0.20% on the loan amount and other miscellaneous charges such as CERSAI (Rs100), CIBIL (Rs.100) , etc. plus the applicable GST of 18% on the mentioned charges.

Can I transfer my mortgage loan? Are there any foreclosure charges?

Yes you can anytime transfer your mortgage loan to another bank unless it is in the fixed duration under the fixed interest rate mortgage loan. Foreclosure charges for fixed rate mortgage loans can cost you 2%-5% on the outstanding loan amount. The charges vary (for salaried to self-employed customers) from bank to bank.

Transferring the loan to another bank means the loan will be treated as a new mortgage loan and you will have to once again pay all the relevant charges for the loan namely- processing fees (0.25%-1% on the loan amount), administrative cost, legal & technical cost (Rs.5000-Rs.10,000), stamp duty cost of 0.20% on the loan amount, etc.

Is there any Lock-In period for mortgage loans?

There is no lock-in period for mortgage loans with floating interest rates. For mortgage loans with fixed interest rate lock-in periods may vary from bank to bank, which can be 1year, 3years, 5 years, 7years or 10years.

Can I have a joint loan application? Who can be my co-applicant?

Yes you can jointly apply for your mortgage loan, with your spouse, parents, children and siblings. An co-applicant is the co-borrower for the loan and is equally responsible for loan repayment alongwith the primary borrower.

What are the tax benefits on a mortgage loan?

There are no tax exemptions for the principal amount in mortgage loans. However for the interest paid you can claim the tax exemptions if you maintain the appropriate documents to justify the end-use of the mortgage loan, such as:

1. Interest can be claimed as business expenses under section 37(1) if the end-use for the mortgage loan is for business purposes.
2. Interest can be claimed as business expenses under section 24(b) if the end-use for the mortgage loan is for purchasing house or home renovation or repairs.
3. No interest exemptions if the end-use for the mortgage loan is for personal reasons such as, children education, marriage expenses, etc.

How can I increase my mortgage loan eligibility?

• By adding your legal income from other sources such as perks and reimbursements from the company, rental income, agricultural income, etc.
• By adding an eligible and earning co-applicant to the loan.
• Go for maximum loan tenure.
• Mortgage a property with higher market value.
• Apply with a bank with lowest interest rates.
• Foreclosing your other obligations such as car loan, personal loan, business loan, consumer loans, credit cards, etc.

I am an NRI working in London. Can I apply for a mortgage loan?

Yes. You can apply for a mortgage loan in India, provided you are employed as salaried in London. Self-employed NRI cannot apply for mortgage loans in India. An salaried NRI working in countries apart from Iran, North Korea (Democratic People’s Republic of Korea), Cuba, Syria, Sudan, and Crimea Region of Ukraine, Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Nepal, Macau, Hongkong or Bhutan, can apply for a mortgage loan in India.

Can I apply for top-up on my existing mortgage loan? What will be the rate of interest?

Yes, you can apply for a top-up loan on your existing mortgage loan provided you have made the timely repayments of your loan EMIs. It can be obtained with minimum documentation, but the interest rates on top-up will be 0.25%-1% higher than your existing mortgage rate.

However your top-up rate remains the same as the mortgage rate, when you apply for a top-up loan along-with the balance transfers to other banks.

How much top-up can I get on my mortgage loan?

The top-up eligibility on mortgage loan is subject to your income eligibility and the market value of the property i.e. the LTV (Loan To Value) criterias of the banks.

Can I get a mortgage loan with any existing loan?

Yes, you can get a mortgage loan along with your other existing loan provided you are capable of paying the additional mortgage EMIs. Your income eligibility & repayment track of existing loans is important for you to qualify for additional mortgage loans.

Am I eligible for a mortgage loan despite a poor credit score?

Yes you can be eligible for a mortgage loan with poor credit score, provided you have a valid justification for the poor scores. However, banks may charge you higher interest rates and processing fees for such cases.

How do I reduce my mortgage loan interest rates?

• Visit your bank to negotiate on your existing interest rate.
• By paying a conversion cost to get the reduced interest rates.
• By Switching loan to a new bank with low interest rates.

Can I repay my loan ahead of schedule? What are the charges?

Yes. You can repay your loan ahead of schedule by making lump sum payments towards part or full prepayment of the loan amount.

For floating rate mortgage loans- Nill Pre & part payment charges.

For fixed rate mortgage loans- Pre & part payment charges are applicable.

(Please note: Banks criterias for foreclosure charges differ for salaried and self-employed customers which also varies from bank to bank.)

Is it possible to get a mortgage loan on grampanchayat property?

Grampanchayat properties are generally not considered for the mortgage loans by banks. However there are only some NBFCs who provide loans on grampanchayat properties. Interest rates on grampanchayat properties are generally high and

starts from 15% to 19%. The processing fees and the cost for processing your mortgage loan on grampanchayat property is also high.

What documents do I require to apply for a mortgage loan?

Your KYC (pan card, aadhar card, residential and office proof), financial documents (4 months salary slips, 2 years form 16, 6 months bank account statement, 3 years ITR copy, business profile & business proofs) and property documents (prior chain of agreement, OC/CC + plan copy, Index 2, share certificate, property tax and property maintenance) are required for applying for a mortgage loan.

Refer link https://www.loanfasttrack.com/blog/blog/finance/mortgage-loan-list-of-documents-for-salaried-customers/ for detailed list of documents required.

&

https://www.loanfasttrack.com/blog/blog/finance/document-checklist-for-mortgage-loan-balance-transfer-for-salaried-customers/ for detailed list of documents required for mortgage loan balance transfers.

What is the difference between home loan and mortgage loan?

Home loan and loan against property i.e. mortgage loan are often used interchangeably, but the two are different loans. A loan taken to purchase a residential property whether under-construction or ready to move from a builder or in resale is called a home loan; while a loan taken on your already existing residential, commercial and industrial property is called a mortgage loan. The difference in both can be attributed to many points such as its end-use, LTV criteria, tenure, loan charges, tax benefits, etc. Get detailed information on its differences on our previous blog “Difference Between Home Loan And Loan Against Property”.

What is the difference between mortgage loan and personal loan?

Although both look similar in emergencies and both loans can be taken to fulfill your immediate requirement of funds, both differ with respect to interest rates, security, tenure, closure charges, closure conditions etc. Since property is provided as collateral in mortgage loans it is termed as a secured loan and therefore its interest rates are low in comparison to the personal loan which is an unsecured loan given only against your income earnings. 

Does it affect my co-applicant if I default my mortgage loan?

A co-applicant is also a co-borrower to the loan which means that if you fail to pay your loan EMIs on time or pay with delay it hampers your credit history and gets reflected in your CIBIL records as loan defaults or delayed payments which further reduces your &

your co-applicant’s CIBIL scores.

Why choose Loanfasttrack?   

If you are worried about how to get a low cost mortgage loan in Mumbai, Loanfasttrack is the answer to your worry.

If you want to transfer your mortgage loan @ lowest rate of 9% and below, Loanfasttrack is your guide. 

If you are looking for a genuine service provider in Mumbai, Loanfasttrack is at your service &

If you want to meet your financial emergencies through a secured way of low cost mortgage loan, reach us on https://www.loanfasttrack.com/. Loanfasttrack will provide you hassle free services at your doorsteps with comparative evaluations of more than 13+ top banks, with no additional cost. You can also contact us on 9321020476 or email on info@loanfasttrack.com.

About Loanfasttrack- Loanfasttrack is a Mumbai based loan provider company since 2015 offering loan services in Mumbai on– housing loan in Mumbai, mortgage loan in Mumbai, personal loan in Mumbai, business Loan in mumbai, unsecured business loans,home loan transfer, top-up loans, car loans, educational loans and loan transfers.

It also helps you:

√ To find the best bank for home loan

√ To get lowest home loan rates in Mumbai

√ To get an instant loan in Mumbai

√ To get instant personal loan in Mumbai & business loan in Mumbai

√ To make you qualify for the maximum loan against property eligibility

√ To get a low cost home loan balance transfer

√ To get assured low interest rates for loan against property in Mumbai

With the lockdown being lifted in Mumbai, we have also resumed with our physical operations at Loanfasttrack. We assure safety while providing hassle free documentation at your doorsteps. With the constraints of limited working staff of the bankers, and the banks safety norms to disinfect the physical copies of the collected applications and documentations, we have temporarily revised the loan processing time by additional 7-9 working days. Loanfasttrack fully supports the bank’s safety norms and measures.