5 Tips Before Opting for Pre-approved Home Loans
A home is more than a residence. It’s a place where memories are made and lives are led. And, buying a home is one of the biggest decisions of your life. Apart from deciding on the style of your future place and the location, planning the finances needed for it is a big step.
You have to decide whether you’re going to pay for the entire property from your savings or opt for an easy home loan. Apart from the ultra-rich who have surplus funds at their disposal, normally the rest of the population apply for a home loan when buying a new house.
Home loans take a while to get approved when compared to other loans like personal loans. Is there any way to quicken up the process? Well, yes, it’s where pre-approved home loans come into play.
What does the Term “Pre-Approved” Mean Exactly?
This is a facility offered by major banks and other NBFCs where people can pre-apply for a home loan even before they decide on the property. Banks check the credit history, repaying capacity of the borrower and issue a notice stating that the applicant can get a home loan during a particular period.
The applicant can then finalize the property and avail the amount at any time during the mentioned period.
How do banks pre-approve home loans?
Banks usually offer pre-approved low-interest home loans to their existing customers who have a good credit score. It’s usually done as a promotion for banking services. Nowadays, major banks offer this facility to even non-customers.
Tips for Availing Pre-Approved Home Loans
- Improve your CIBIL score
Banks check the credit score of the applicant before pre-approving home loan online. Also, they prefer candidates with high repaying capacities and with a clean slate. So, make sure to pay off all your outstanding bills and other debts, to improve your chances significantly.
- Shortlist a few properties and then begin the Pre-Approval
Finding the right property is a time-consuming task. However, pre-approved loans are valid only for a particular time period. So, make sure that you shortlist a few preferred properties before you begin the loan approval process.
- Get your Documents in Order
Make a list of the required documents and get them to speed up the process and to avoid any unnecessary glitches in the approval process.
- Look out for Discounts
Often banks offer pre-approved secured home loans during promotional periods at lower interest rates. Make sure to capitalize on the offers.
- Have a clear idea of the amount your want to avail a loan
Unlike regular home loans, you don’t know the exact price of the property you intend to buy. So, contact your real estate dealer and find the exact amount of similar properties. This will give you a fair idea on the amount to avail from your bank. Also, home loan calculators can help you with this.
Should you Opt for Pre-Approved Home Loans?
Pre-approved loans are a boon for home buyers. They eliminate the uncertainty of home loan sanctions and also helps you narrow down your property search. Make use of this facility and simplify your home search and purchase.
