Documents Required for Mortgage Loan: Essential Documents Needed for a Mortgage Loan

Mortgage loans, property loans or loans against property are all the same. Individuals who own property — residential, commercial or land — can pledge this property as security or collateral and secure loans against it. Such loans do not pose a very high risk to loan borrowers and consequently, property loan interest rates tend to be low. The loan tenor is relatively long, which makes loan repayment furthermore less stressful. The LTV ratio can go as high as 70%, making mortgage loans one of the few loan options that give borrowers access to substantial funds. 

Other than walking the readers briefly through the mortgage loan application process, this article also provides a list of the documents required for mortgage loan to help applicants be better prepared and navigate the entire process smoothly. 

The mortgage loan application process is fairly simple. One applies for a loan against property and submits all the documents asked for. This is followed by property and document verification stages, during which lenders authenticate the documents and also assess the property and whether it complies with all the set norms. On successful completion of this stage, the loan borrower is asked to sign the loan agreement which clearly mentions the terms and conditions of the loan and wait for the loan amount to be disbursed into their account. 

Securing the mortgage loan lowest interest rates is easy if you have a high CIBIL score (in the range 750 to 900), pledge a high-quality collateral, opt for a low LTV ratio loan and maintain a FOIR or debt-to-income ratio under 40% as well as high income and job stability. Low property loan interest rates help ensure affordable EMIs and low cost of borrowing funds. Individuals planning to borrow against a property they own must always use a mortgage loan EMI calculator to figure out the most ideal loan amount, tenor and EMIs for them and borrow keeping income and affordability in mind.

They must also keep the hard copies and soft copies of all the documents required for mortgage loans handy with them if they want to navigate the entire process smoothly. Below we provide to readers with a generic list of documents that loan applicants must submit to lenders to be approved for a mortgage loan in India.

Documents Required for a Loan Against Property 

– You will need to submit a properly filled mortgage loan application form 

– Your lender will ask you for identity-proof documents. Most loan applicants submit PAN, Aadhar, Voter ID, Driving License or Passport under this category. Note that submitting a PAN card or Form 60 is mandatory. 

– You will also need to submit address-proof documents. If you are a self-employed individual, you will need to submit address proof for both your home and office. Most borrowers submit Aadhar, Voter ID or a copy of the electricity bill under this category. 

– Salaried people are asked to submit their salary slips along with bank account statements and sometimes, Form 16 

– Self-employed individuals have requested Bank account statements, Form 16 and profit and loss statements 

– You will be asked to submit original papers of the property you plan to pledge as security. Under this category, all loan applicants are asked to submit the original property title deed, latest maintenance bills, property tax and water tax receipts, non-encumbrance letters from the co-op housing society, etc. 

This is just a generic and exhaustive list. Sometimes, lenders ask for more documents. So, it is always a good idea to connect with the bank or lender before beginning the application process and requesting in advance the list of loan against property documents you will need to submit along with the application. Doing this will make your life a lot easier. Loans against property borrowers must also try and secure the lowest interest rates using the tips mentioned in this article. Further, they must borrow cautiously and what they can borrow. Doing so will make loan repayment easy.