In India, buying a home is considered a major milestone. You need to spend a good number of years preparing and planning it. Self-financing is a traditional way to finance your home purchase, but it could take years. If you wish to buy a home within a specific timeframe, consider applying for a Home Loan. They let you apply for a significant percentage of financing to buy your dream home.
Thanks to competitive interest rates and flexible repayment tenures, you can consider financing without compromising your affordability. Visit the nearest bank or go online to apply for Home Loan. The application procedure is simple. Fill out the form and submit the necessary documents to apply for a Loan. The bank takes a few days to verify your details and documents.
Upon successful verification, the bank extends a suitable Loan amount and interest rate based on your eligibility.
What is a Home Loan sanction letter?
The Home Loan sanction letter is a financial document the bank offers. The document indicates you can apply for the Loan amount you want. The document highlights all the important details, such as Home Loan interest rate, tenure, and other repayment details about the Loan. Hence, it is a document of immense significance. The bank posts a hard copy of the sanction letter to your postal address and shares a digital copy over email.
Keep this sanction letter handy, as you need to submit it to your builder to secure your flat. Furthermore, the sanction letter is a reliable reference point throughout your repayment.
What are the details included in a Home Loan sanction letter?
Every bank has a different sanction letter format. However, the following is a mention of common details you can find in the Loan sanction letter:
- The validity period of the sanction letter
- Home Loan interest rates
- Type of interest rates
- Base rate considered for calculation purposes
- Repayment tenures
- Payable EMI and associated details
- Special schemes, if applicable
- Tax benefits
Why should you refer to the sanction letter?
Referring to the Home Loan sanction letter helps in the following ways:
- Know applicable interest rates: As mentioned, the sanction letter mentions the applicable interest rates. Knowing the same gives you a chance to negotiate for a better interest rate. Alternatively, you can compare and switch to a lender offering a better Home Loan interest.
- Plan repayments: The sanction letter highlights the payable EMI. This lets you plan your repayment. You can repay the Loan without struggling or defaulting.
- Proof of communication: The sanction letter is proof of all the repayment terms discussed between you and the bank. This ensures neither you nor the bank can go back from the agreed terms.
