Navigating Mortgage Loan Eligibility and Required Documents

Mortgage loans are also known as property loans or loans against property. Individuals who own a residential or commercial property can pledge it as collateral or security and avail of a loan against it. Since mortgage loans are backed by collateral, these loans fall under the bracket of secured loans and therefore, lenders charge a low rate of interest on these loans. Property loan interest rates start from 9% per annum, one of the key factors responsible for the growing popularity of these loans. Further, these loans come with a long repayment period of 15 years or higher (loan tenor varies from lender to lender), which further eases the burden of loan repayment. Most importantly, the funds availed of come with zero end-use restrictions and therefore, borrowers can use the money however they like. 

The demand for loans against property has witnessed a major surge over the last few years and the uptrend is likely to continue. If you are planning to apply for a property loan, make sure to meet all the mortgage loan eligibility requirements if you wish to be considered eligible for these loans. 

Mortgage Loan Eligibility Requirements 

1. The loan applicant must be a residing citizen of India. 
2. The loan applicant must be employed with a reputed public or private sector company and must be able to show at least 3 years of relevant experience. 
3. Self-employed individuals planning to avail themselves of a mortgage loan are considered eligible when they can show at least 5 years of business vintage. 
4. The loan applicant must have a credit score of at least 725 or above. Minimum credit score requirements also vary from lender to lender. Some lenders also consider individuals with credit scores of 700 and above eligible for a property loan, some lenders set the minimum property loan eligibility requirement at 750.
5. The age requirements for these loans vary from lender to lender. However, most lenders require borrowers to be between 25 and 65 years of age to be considered eligible for a property loan. Loan applicants must keep in mind that the maximum age is always the age of the lender at the time of applying for the loan and not at the time of loan maturity.
6. Lastly, the loan applicant must have all the property papers in their name and must be the rightful owner of the property they plan to pledge as collateral.

Mortgage Loan Document Requirements 

Individuals applying for a loan against property are generally asked by lenders to submit the following documents: 

1. A duly filled property loan application form along with a few passport-sized photographs 
2. Identity and address proof documents, such as Aadhar, Voter ID, PAN Card, driving license, utility bills, etc.
3. In the case of salaried individuals, one is required to submit proof of employment documents, such as an identity card issued by their employer. 
4. In the case of self-employed individuals, borrowers are required to submit documents that prove business ownership, such as a partnership agreement and registration certificate.
5. Proof of income documents, such as latest salary slips, profit and loss statements, last 3 months’ bank account statements, income tax returns, etc. 
6. You will also need to submit all property documents, such as title documents, no-objection certificates, etc.

Document requirements for property loans also vary from lender to lender. So, before you apply for a loan against property, go through the mortgage loan document checklist and talk to your lender regarding what documents you will need to submit during the application process. Keep these documents ready to experience hassle-free loan processing.