Jun 05, 2007 10:47 AM
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Have seen a few reviews where many have expressed a lot of unhappiness with the financial institution providing a home loan. Would like to use my experience to share the best way to go for the right home loan product / Bank and the way one should transact during the currency of the home loan.
1) Am in favour of taking home loans from nationalised Banks - even though these may appear drab and bureaucratic at first. Banks such as Corporation bank, Canara Bank, SBI, are quite dynamic.
2) Most nationalised Banks have a home loan Cell . Best it to go to this branch since the people here are specialised in handling home loans. Even if the Cell is a little away from office or home. Also, Home Loan Cells have more power to sanction higher amounts as a result of which approvals come in very quickly.
3) Meet the concerned Manager / Officer of the Home Loan Cell in 2 / 3 Banks. Collect all information in detail and feel where you have the maximum comfort. Banks have varying methods to calculate your eligibility - some go by gross salary and some by net salary. Some take your other income also into account, and so on.
4) For your information, most Banks offer the same interest rate with a range of plus/minus 0.5%. So, one need not be too driven by which offers the lowest. Take other factors into consideration such as where the title documents would be( in the Branch or some depository in some other city - remember documents can be lost) stored, how much is the processing fee, what are the bank timings, how friendly is the staff, whether interest is daily reducing or monthly, whether the Bank charges any fee for transactions such as statements etc., etc.
5) Most important avoid dealing with an agent and talk directly to Bank employees( which is a big plus with the Nationalised Banks).
6) Having finalised a Bank, fill in all the details in the application form in full and honestly. Add all supporting documentation as per equirement. In short, the application form should be perfectly filled and with all enclosures. This itself will give a great impression about you to the Bank Manager. For instance, my application went through in just under a day and even today the Bank Manager quotes his experience of dealing with me as an example( am sorry to be immodest but this is important).
7) After taking the loan, please submit all demand notes, receipts, other documents generated during the course of the loan currency promptly with a covering letter and keep an acknowledgement for submitting same ot the Bank. Banks are always careful with people who do their documentation well.
8) Keep in touch regularly with the converned officer / manager. Since transfers are common, it is important to know who is in charge.
9) Make your payments promptly. In case you have a problem, do not avoid speaking to the concerned officer or manager. In a nationalised Bank, they always try their best to help you as much as possible(if you have good rapport and track record).
10) Follow all procedures religiously - do not try any shortcuts for any transaction.
11) Open an SB account in the same branch and keep ample money to cover your EMIs and a letter asking the Bank to debit your account directly.
12) Cover your home for both general insurance and yourself for life insurance so that the loan amount is insured. You can get a decent discount in interest rate if you do this. Well, generally I have had a decent experience so far with Home Loan as a product because of the above guidelines followed by me.
