Housing Loan:
What is a Housing Loan?
A housing loan (or home loan) is a type of secured loan provided by banks or financial institutions to help individuals purchase, construct, or renovate a residential property. The borrower repays the loan in Equated Monthly Installments (EMIs) over a fixed tenure, usually 10–30 years, at an interest rate that can be fixed, floating, or mixed.
Advantages of a Housing Loan
Helps Buy a Home Without Full Payment Upfront
You can own a house by paying a small down payment (usually 10–25%) and finance the rest through a loan.
Tax Benefits
Section 80C: Deduction up to ₹1.5 lakh on principal repayment.
Section 24(b): Deduction up to ₹2 lakh on interest payment for self-occupied property.
Long Repayment Tenure
Flexible tenure up to 30 years, making EMIs affordable.
Asset Creation
Instead of paying rent, you invest in your own property.
Improves Credit Score
Timely repayment builds a strong credit history.
Eligibility Criteria
Eligibility may vary by lender, but generally includes:
Criteria Requirement
Age 21–65 years (at loan maturity)
Employment Type Salaried, self-employed, business owners
Income Minimum monthly income as per lender norms (e.g., ₹25,000+)
Work Experience Salaried: 2–3 years; Self-employed: 3+ years in business
Credit Score Usually 700+ for best rates
Property Must be legal and lender-approved.
Documents Required
For Salaried Individuals
Identity Proof: Aadhaar, PAN, Passport, Voter ID
Address Proof: Utility bills, Aadhaar, Passport
Income Proof: Salary slips (last 3–6 months), Form 16, Bank statements
Employment Proof: Employment certificate or offer letter
Property Documents: Sale agreement, title deed, approved building plan
Photographs: Passport-size photos
For Self-Employed
All ID and address proofs as above
Business Proof: Registration certificate, GST details
Income Proof:
IT Returns (last 2–3 years)
Balance sheet and Profit & Loss statement certified by CA
Bank Statements: Last 6–12 months
Property Documents: Same as above