Seeking home loan? If yes, then you must also be wondering why a private home loan lender such as a financial institution/bank emphasis to have a look at the bank statement. Obviously, lending money that too in lakhs is not a joke thus the lender has all rights to check and recheck the necessary documents before sanctioning the home loan amount. But, many of the aspiring homeowners try to convince the lender that he/she will pay back in time. But, there is more than that which a lender is required to check. So, go through this blog post and know why a lender asks you for the bank statement:
It is not the end of the world, if you have a poor credit score. You can still procure a home loan. Financing a home loan on a poor credit rating can get tricky if you don’t connect with the right mortgage lender, who has a vast experience of closing subprime loans. Earlier anybody, almost anybody could get a loan sanctioned, but things have changed now. People with low credit qualify for a home loan with higher rates and terms.
Your credit score decides two major aspects—
1] Loan Program- Whether conventional or non-conventional.
2] Pricing- Interest rate and any additional charges indicative of the credit score. [Read more…]
What is your priority while selecting a home loan lending bank? For most of us it is the rate of interest that matters. But it is really important to choose the right home loan lender as you would be connected for about 10-15 years, that is, until your entire loan is cleared. In that case, making a low interest rate your only criterion would not be a good idea. Other factors like proper disclosure of terms and conditions, responsiveness to your queries, etc. also play a major role.
Given below are a few tips to help you choose the right lender:
Don’t Fall Trap to Low Interest Schemes- Nowadays a number of smaller lending companies are growing in the market. They offer unrealistically low rate of interests to their new customers and subsequently increase it in the name of increased cost of funds. You should check the credentials of such companies. It would be better to go for a company that has been in the lending business for quite sometime.
Don’t Apply to Several Banks at the Same Time- Maintaining a good CIBIL score is really important for negotiating a lower interest rate with the banks. However, if you apply at several banks at the same time, each such application can reduce your CIBIL score by 10 points which is not a good idea in the current market situation.