Home Loan

At Churuwala Homes LLP, we understand that securing the right home loan is a crucial step in your journey towards buying of your dream home. Our Home Loan Assistance tab is designed to provide you with information, expert guidance, and personalized services to make your home buying experience seamless and rewarding as under:

1. Expert Guidance: Our team of experienced professionals will guide you through the entire home loan process, from understanding your financial requirements by selecting a wide range of home loan options available with various bank, NBFC and other financial institutions that best suits your financial needs. This ensures that you get competitive interest rates, favorable terms, and flexible repayment options. With years of experience in the real estate industry, we have the expertise and knowledge to navigate the complexities of home loans. Our experts stay updated with the latest market trends and regulations to offer you the best advice and solutions.
2. Customized Solutions: We understand that every buyer is unique and so are their financial circumstances. Our experts will work closely with you to tailor a home loan solution that aligns with your financial goals and aspirations.
3. Streamlined Process: We simplify the home loan application process for you, handling all the paperwork, documentation, and coordination with lenders. This saves your time, effort and ensures a smooth and hassle-free experience.
4. Transparency: We believe in transparency and integrity in all our dealings. You can trust us to provide accurate information, clear terms, and complete transparency throughout the home loan process.
5. Customer-Centric Approach: Your satisfaction is our priority. We take a customer-centric approach, listening to your needs, addressing your concerns, and ensuring that you make informed decisions that are in your best interest.
6. Negotiations: We assist you to negotiate best terms of processing fees, interest rate, foreclosure charges, balance transfers, eligibility, tenure and other mandatory terms offered by various lending banks, NBFC and other financial institutions.

Home Loan – Complete Guide

1. Introduction

A home loan is one of the most common ways to finance the purchase of a property in India. Whether buying a ready-to-move or, an under-construction property, or even renovating an existing house, home loans make it possible to turn your dream into reality without exhausting your savings.

Indian banks (Private & Nationised) and housing finance companies across the country offer a variety of home loan products with competitive interest rates, flexible repayment options, and benefits under government schemes. However, choosing the right loan and understanding the process requires careful and expert research.

This guide explains everything you need to know — from eligibility and interest rates to documentation, tax benefits, and repayment strategies.

2. Types of Home Loans in India

• 🏠 Home Purchase Loan – For buying a new or resale property.
• 🛠 Home Construction Loan – For building a house on self owned plot.
• 🔄 Home Loan Balance Transfer – To shift an existing loan to another lender for lower interest rates and other benefits.
• 💰 Home Improvement Loan – For repairs, renovations, or upgrades of an existing Home.
• 🧾 Home Extension Loan – For adding extra space or floors in an existing Home.
• 🏡 Plot Purchase Loan – For buying a NA plot to build a house.

3. Eligibility Criteria for Home Loans

• Age – Usually between 21 and 65 years.
• Income – Minimum monthly/annual income as specified by the lender.
• Employment Type – Salaried, self-employed, or professional.
• Credit Score – Generally 700+ credit score is required for better rates.
• Repayment Capacity – Based on income, existing EMIs, and obligations.

4. Home Loan Interest Rates options:

• Floating Rate – Changes with market conditions (linked to Bank Repo rate/MCLR).
• Fixed Rate – Rate remains the same throughout the tenure of loan.

5. Factors affecting interest rates:

• Applicant’s credit profile
• Loan amount & tenure
• Type of property
• Relationship with the bank

6. Maximum Loan Amount & Tenure

• Loan amount is usually up to 75–90% of the property’s value (Loan-to-Value ratio).
• Maximum tenure can go up to 30 years depending upon the lender’s criteria and borrower’s profile.
• Higher tenure reduces EMI but increases total interest paid.

7. Property Documents Required for Home Loan

• Registered Agreement for Sale
• Stamp duty and registration receipts
• Share Certificate in case of a registered cooperative housing society
• Maintenance bill and payment receipt issued by the housing society/builder
• Property tax bill and payment receipts
• Allotment Letter from Housing Board/Private Builder/Flat Owners Society
• Payment receipts of all payments made for flat purchases
• Approved building master plan and floor plan
• NOC from the Builder/Housing Society
• Occupation certificate in case of a ready to move property
• Detailed estimate of construction cost. for the self constructed home on a plot of land and the date by which to commence and complete the construction of the house.
• Title certificate from Advocate.
• Commencement and completion certificate issued by the local body
• Any other documents as may be required by the banks as may be necessary to the loan sanctioning and verification process.

*Property documents may vary from bank to bank.

8. Documents Required for Applying a Home Loan

✅ For Salaried Applicants:

• Identity Proof – PAN Card / Aadhaar Card / Passport / Voter ID card, Driving license or any other government issued photo ID proof.
• Address Proof – Aadhaar Card / Passport / Utility Bills, Voter ID, Ration card, Bank passbook/Statement or any other government issued address proof
• Salary slips of last 3 to 6 months
• Employment Proof – Offer letter / Employment certificate
• Bank Statements – Last 6 months
• Form 16 – Last 2 to 3 years
• Acknowledgements of the Income Tax Returns (ITR) filed of last 2 to 3 years’ and along with Form 26AS
• A copy of Educational qualifications certificates of the applicant and all co-applicants
• Property Documents as mentioned herein above
• Recent Passport-size photographs

*Required documents may vary from bank to bank.

✅ For Self-Employed Applicants:

• Identity Proof – PAN / Aadhaar / Passport / Voter ID / Driving License
• Address Proof – Aadhaar / Passport / Utility Bills / Voter ID / Ration Card / Bank Statement
• Business Proof – GST Registration / Business License
• GST returns filed for last 2–3 years
• Partnership deed / LLP Agreement / MOA / Trust Deed
• Certificate of Incorporation / SEBI Registration Certificate
• Board Resolution / LLP Resolution / Trustee Resolution
• ITR Acknowledgements with Form 26AS (last 2–3 years)
• Financial Statements – CA-certified Balance Sheet & P&L (last 2–3 years)
• Bank Statements – Last 6–12 months
• Educational qualification certificates (applicant & co-applicants)
• Property Documents (as above)
• Recent Passport-size photographs

*Required documents may vary from bank to bank.

9. Home Loan Process

• 1️⃣ Application Submission – Filled and signed the loan application with all required documents.
• 2️⃣ Processing Fee Payment – Usually 0.25%–0.50% of the loan amount.
• 3️⃣ Verification & Credit Assessment – Lender verify all documents, credit score, past loan repayment records, and current loan payment capacity of the borrower.
• 4️⃣ Sanction Letter – Issued if approved, stating amount, rate, tenure, and other terms and conditions.
• 5️⃣ Legal & Technical Evaluation – Property documents verified; valuation report from at least 2 valuers empanelled with the Lender.
• 6️⃣ Loan Agreement & Disbursement – Funds released to reseller/developer of the property in lump sum in case of resale or ready-to-occupy property, or in case of under-construction properties, to the developer in stages or lump sum.

10. Tax Benefits on Home Loans

Under the Income Tax Act, 1961, home loan borrowers can claim deductions on both principal repayment and interest payment. Below are the key provisions:

Section 24(b) – Deduction on Interest Payment

• Deduction up to ₹2 lakh/year on interest payment for self-occupied property.
• Deduction can be claimed once the interest becomes due, even if not actually paid.
• Eligibility Criteria:
  • Loan should be obtained for purchase, construction, repair, or renovation.
  • Construction must be completed within 5 years from the end of the financial year in which loan was taken.
  • If loan is for repair/renovation → Maximum deduction allowed is ₹30,000.
• For self-occupied property: Maximum deduction of ₹2 lakh.
• For rented property: Full interest amount can be claimed without limit.
• Note: Deduction under Section 24(b) is not available under the new tax regime.

Interest Paid During Pre-Construction Period

• Pre-construction period = Time during which property is under construction.
• Deduction allowed in 5 equal installments, beginning from the year construction is completed.
• Subject to the overall limit of ₹2 lakh (for self-occupied property).

Example: If you took a loan in April 2022 and construction completed in April 2024, you can claim pre-construction interest from FY 2024-25 in 5 installments.

Joint Home Loan

• If loan is taken jointly, each co-borrower & co-owner can claim:
  • Up to ₹2 lakh interest deduction (Sec 24(b))
  • Up to ₹1.5 lakh principal deduction (Sec 80C)

Section 80C – Deduction on Principal Repayment

• Deduction up to ₹1.5 lakh/year on principal repayment.
• Includes stamp duty, registration, and other transfer-related expenses.
• Conditions:
  • Property must not be sold within 5 years of possession, else deduction is reversed.
• Not available under the new tax regime.

Section 80EE – Additional Deduction

• Deduction up to ₹50,000/year on interest payment (over and above Sec 24(b)).
• Conditions:
  • Loan ≤ ₹35 lakh & property value ≤ ₹50 lakh.
  • Loan sanctioned between 1 April 2016 – 31 March 2017.
  • First-time home buyer (should not own any other house on loan sanction date).
• Not available under the new regime.

Section 80EEA – Additional Deduction

• Deduction up to ₹1.5 lakh/year on interest payment (over and above Sec 24(b) & Sec 80C).
• Conditions:
  • Property stamp value ≤ ₹45 lakh.
  • Loan sanctioned between 1 April 2019 – 31 March 2022.
  • First-time home buyer only.
• Not available under the new regime.

Tax Benefits at a Glance

11. Factors to Consider Before Taking a Home Loan

• 📊 Compare interest rates from multiple lenders.
• 💰 Check processing fees, prepayment charges and hidden costs.
• 📅 Choose the tenure carefully for manageable EMIs.
• ⭐ Maintain a good credit score to get better loan terms.
• 📈 Understand floating vs fixed rate implications before deciding.
• 📑 Read all the terms in the sanction letter carefully and negotiate with the lender to get the best deal.

12. Prepayment & Foreclosure

• 💡 Most floating-rate home loans for individuals have no prepayment penalty.
• 💰 Fixed-rate loans may attract charges for early closure.
• 📉 Prepaying early in the loan tenure helps save significant interest cost and foreclosure charges.

13. Common Mistakes to Avoid

• ❌ Borrowing more than your repayment capacity.
• ❌ Not reading the loan sanction terms carefully.
• ❌ Ignoring home loan insurance for protection.
• ❌ Defaulting on EMIs, which will negatively affect your credit score.

14. Contact Us

Please feel free to reach out to us through our website, email, WhatsApp or Mobile. Our home loan team will be happy to assist you.