Lately, have you thought to buy a new house or renovate your old home? To fulfil any of the needs you will require money. There might be chances that you don’t have the money available immediately. Banks and NBFCs come to the rescue in such a situation because there are more than 100 financial institutions who provide home loans to buy flat or a house, construction of house or renovation. Every bank has different eligibility criteria for a borrower to avail a home loan and there is a set of documents which needs to be submitted, those documents are verified and after which the interest rate on a home loan is decided and the home loan application is approved.
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The general documents which are required by the banks are:-
- Duly filled application form.
- Proof of identity like PAN Card, Voter ID Card, Aadhaar Card, Driving License, etc
- Proof of address like Aadhaar Card, Voter ID Card, Ration Card, Passport, Utility Bills, etc
- Income proof- Bank account statements for the last six months for salaried and Income Tax Returns for self-employed professional
- Cheque issued for processing fee payment
- Photographs – Passport-sized
Out these income proof documents like bank statement for salaries and Income Tax Returns for self-employed professional plays a significant role. The income proof document because it determines the repayment capacity of the borrower. A borrower might face issues if there is no stable income proof and they may have to fulfil the extra criteria to get a loan because income is the important parameter of eligibility criteria to get a loan, but don’t get disheartened here are few tips which will help you get a home loan without income proof.Â
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Talk to your representative:
You visit the bank branch to avail a home loan, you will be assigned a banks representative who will help you with all the formalities which need to be done and he/she also informs about the eligibility criteria, documents required and terms and condition. At that moment inform the representative regarding the absence of the documents. You can proof your income source by providing sales receipt, inventory positions. But remember, you should be truthful your representative.
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Apply with a co-applicant:
Apply for a home loan with an earning family member can help you avail the home loan easily. With a co-applicant, you can also apply for a bigger loan amount and repayment capacity also increases. If a co-applicant has an income proof then he/she will consider as the main borrower.
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Check on your savings:
Not only income proof but banks do check the balance in a savings account as well. It is necessary to maintain the minimum balance required as sound finances will increase the chances of loan approval.
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Maintain a good credit score:
Another important parameter after income is the credit score. It is necessary to maintain a good credit score if you don’t have an income proof because credit score is another parameter which determines the creditworthiness of a borrower. Minimize the use of credit cards and close all the previous loans to maintain a good credit score.
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Go for (Lower Loan- To- Value) LTV:
To increase the chance of getting a home loan without income proof try making a higher down payment for a loan. Try reducing the Loan-To-Value ratio, the loan-to-value ratio is a financial term used by lenders to express the ratio of a loan to the value of an asset purchased. For example, if the property is valued at 70 percent then you have made payment of the remaining 30 percent. Availing lower LTV is a great idea in case you don’t have the income proof.
Conclusion:
Availing a home loan from any financial institution can be a daunting task with the availability of proof of revenue or an ITR form is a daunting task. Better is to wait and collect the income proofs and other documents required by the bank. However, if that is not possible then you can try any of them or all the tips mentioned above.Â
