Make your home buying dream a reality this Gudi Padwa

06-Apr-2019    |    Source:    Times Property

Sheetal and Anita both in their late 20’s felt their world come crashing down when, after saving up for almost three years, the bank turned down their application for a home loan. Anita says, “About four to five years ago, my sister and I began to think about the fact that my father had no property to call his own as he had lived in the company-provided house for almost his entire life.” The sisters then began to look into the nitty-gritty of what is required to buy a home, “We saved for almost two-and-a-half-years and got our paperwork in order. But when we applied for the loan, it was rejected immediately,” she adds.

The sisters went back to the drawing board and hired a financial consultant, who told them what made them look ‘bad’ in the eyes of the bank. Anita says, “We were told that the bank looks at our credit history. If the debt you are in is not a big amount, it is alright, but what is important is the number of times you have defaulted or delayed the repayment of your monthly dues. The consultant explained to us that we need to even pay our bills (electricity, cable, phone, etc) on time, as they reflect our overall financial position.”
By adhering to these few steps, in two years, the sisters finally got the all-important approval from the bank. Cut to 2018, the sisters purchased a snug home for their family in Pune and are planning to purchase their second apartment in a few years’ time.
WHAT TO DO POST THE REJECTION?
Firstly don’t panic and don’t lose heart.
In the next year or so, improve your credit score by settling ongoing dues - the score does not improve immediately and takes time;
The No Dues certificate: If you have had a bad credit history, then you will have to settle your dues and get a ‘No Dues’ certificate from your financier to help you the next time you apply for a loan;
The CIBIL score: Contrary to popular opinion, the CIBIL score is not about your credit history alone. It also includes things like loans that you might have stood guarantor for;
Down-payment: Save up and have more money in hand so that your loan amount and monthly EMI keep decreasing;
Get a co-signer: Ask a family member to co-sign a loan so that it helps you for approval;
Try another bank: Try some other bank that might not be too stringent in their prerequisites or eligibility criteria;
Collateral: You can offer a car or even property that is owned by your parents as collateral, so that you have something to show as a guarantee to the bank, even though you might not need to ever use it. Amar Bahl, chief operating officer, ART Housing Finance, says, “A home loan application can get rejected because of a variety of reasons.

However, it primarily focuses on one’s capacity to pay, intention to repay and the asset quality. However, many times, a rejection does not reflect upon the applicant’s credibility, but incompatibility with the lender’s lending norms.”

INCREASE YOUR HOME LOAN ELIGIBILITY:
Research the lender’s norm of funding w.r.t your profile and property type as all lenders do not lend to all profiles and all property types;
Check whether you have sufficient income to repay the loan along with other existing loans that you may have, or rope in another earning member of the family;
Ascertain whether any loan or credit card taken earlier has had poor repayment performance and try to have that resolved with sufficient evidence;
Provide correct documentation and complete information; Be true to yourself and to the lender and never try to illegitimately influence the lender’s representatives.

RED FLAGS IN YOUR PORTFOLIO:
Do not delay payments and ensure all financial obligations and utility bills are realised within the due date;
Ensure there is no inward cheque bounces and that your bank statements represent your banking behaviour while there are proper justifications of outward clearing bounces, if any;
Try to repay high EMI, but short tenure loans to free up your EMI repayment capacity;
If you have small loans like a personal loan or a car loan, pay your EMIs on time and improve your credit score;
Do not have too many loans reflecting impulsive behaviour, as they may not be conducive towards further credits.

RELATED STRESS AND TRAUMA:
One of the biggest drivers behind buying a home among young professionals is marriage. Psychologist Harish Shetty says, “Young professionals are pressured by their parents, their partner’s parents, their friends and their own insecurities to own a house before their marriage.
This tends to stress them out leading to anxiety issues that are extremely harmful.” And the financial burden that follows aggravates the issue, especially in the wake of rejection by the lender.
Hence, it is important that the borrowers take care of all the prerequisites before applying for a loan.
 
Everyone deserves to get their dream home and we thepropertist.com can help you narrow down your search.  

 
 
 

Projects You may be interested in

Mayfair Aasaan

Mayfair Aasaan

Asangaon, Mumbai Beyond Thane

Contact Us

Use the form below to contact us!

Share Property

Property Valuation Form