Getting a loan with HFFC is easy and hassle-free. In this article we outline the application process step by step.
- Identify the property you want to buy
We have drafted a set of guidelines to consider, when choosing a property that you want to invest in.
- Understand the financial implications
After you have zeroed in on the property of your choice, it is necessary to understand the fully loaded property price. This is a crucial component in planning for the financial arrangements for the purchase. There are often hidden costs to any property, which are disclosed later on. Be aware of your full expected financial outlay with our handy guide.
- Apply for a loan
Applying for a loan with Home First is simple and convenient. Just provide the documents, as listed here, and we will ensure hassle-free processing of your home loan application.
- Credit appraisal and loan sanction
Home First will consider the applicant and co-applicant’s income, assets, liabilities, credit history (CIBIL), qualifications, and other factors to decide on the loan. The appraisal may involve visits to the residence and office, as well as personal discussions with the applicant and co-applicants.
If the loan is approved, a sanction letter will be sent to you. You have to return a signed copy of the sanction letter to acknowledge acceptance.
- Down payment for the loan
Home First may sanction up to 90% of the property price depending on the credit appraisal. The balance amount, referred to as down payment, has to be paid by you directly to the builder.
The actual percentage of the loan sanctioned and the down payment will be specified in the sanction letter. Once you have made the down payment to the builder, you need to hand over a few documents to HFFC so that we can commence disbursal.
- Construction phase and pre-EMI interest payments
During construction phase, Home First will disburse funds to the builder on your behalf. This will be based on the payment requests made by the builder, as per the construction schedule.
Home First will only charge interest on the amount disbursed as loan during the construction phase. Interest will be billed on a monthly basis and the billing statements will be sent to you before the first of every month. Payments have to be made before the fourth of the following month. These interest payments are referred to as pre-EMI interest payments. EMI payments will start only after completion of the project and registration of the property.
- Registration, possession, and EMI payments
Once construction is complete and the property is ready for possession, the sale deed has to be executed and registered. This ensures transfer of ownership rights of the property from the builder to the buyer. The original sale deed after registration has to be handed over to Home First. This indicates the mortgage of the property with Home First. The sale deed can be executed only after the full consideration for the property has been paid to the builder either through the buyer’s own funds or a loan.
Repayment of the loan through Equated Monthly Installments (EMIs) commences from the fourth of the subsequent month after registration. The EMIs will be as per the terms governing the transaction as mentioned in the loan agreement. Try our EMI Calculator to find out the EMI payable for any combination of loan amount, interest rate and tenure.
An Electronic Clearing Service (ECS) mandate (should be ACH), authorizing Home First to debit your bank account on a specified date for payment of EMIs, will be collected from you.
- Pre-payment of loan
Home First allows partial as well as full pre-payment of the loan, after registration, when regular EMIs have commenced.
- Partial pre-payment: You can make a partial pre-payment and thus reduce your outstanding loan amount and interest outflow. Home First will give you the choice of: 1) Reducing your EMI proportionate to the reduction in loan amount. The tenure will remain the same as your original tenure in such cases. 2) Reducing your tenure and keeping the EMI the same.
- Full pre-payment: You can make a full pre-payment and repay the entire outstanding loan. This will ensure that the loan is closed and the loan agreement is terminated. All original documents pertaining to the property collected from you during the loan approval process will be returned to you.
Home First will NOT charge any pre-payment or closure charge for partial or full pre-payment.
- Property and credit insurance
To safeguard yourself from loss to the property by fire and other hazards, it is advisable to take an insurance policy for your property. This will help recover any losses to the property in the event of an untoward incident. A copy of the insurance policy has to be submitted to Home First. All general insurance companies offer property insurance.
Credit insurance enables the loan to be repaid by the insurance company in the case of any unfortunate occurrence to the borrower.
Ask your relationship manager for more details on insurance products.
If there are any questions or doubts, please do get in touch with us. We are more than happy to address queries or help