When you’re excited to purchase a home, the long approval process can seem daunting. Even in today’s digital age, home loan applications require a lot of paperwork that must be submitted to and verified by the lender. After all, let’s face it: the housing market is challenging for almost everyone and no one wants to spend weeks waiting for their home loan approval, let alone months.
If you have your heart set on buying a home as soon as possible, keeping your approval time as short as possible is important. Fortunately, there are ways to shorten your home loan approval time and get the ball rolling so you can move into that new house sooner rather than later. The first thing you need to do is to check off your to-do list. Make sure you are ready for the home loan process. If you are not, the time taken to get that home loan will only stretch out and will become even more stressful. Here are a few important strategies to shorten your home loan approval time.
Maintain a good credit score
A good CIBIL or credit score is crucial to get approved for a home loan quickly. Here are some tips to help improve your score:
1. Make all your payments on time. This includes credit card payments, utility bills, etc.
2. Keep your credit utilisation low. This means using only a small portion of your available credit.
3. If you have any debt, try to pay it off as soon as possible.
4. Check your credit report regularly for errors, and dispute any that you find.
Shop around for the right lender
Not all lenders have the same policies. Some will be able to approve your loan faster than others. The best way is to get pre-approved for a home loan, which means that your lender has already checked your credit score, income, and other factors and decided that you are good enough to get a home loan. This means that you will already have an idea of how much money you can borrow and it will streamline the process when you are ready to apply for a loan.
Currently, there are a plethora of home loan options available in the market. So, as you prepare your application, shop around for the best mortgage rates and study the approval time of each lender. This will help you make sure you're getting the best deal possible and improve your chances of getting approved for a home loan.
Make a bigger down payment or margin contribution
If you're hoping to get approved for a home loan quickly, one of the best things you can do is try to put down a bigger down payment. Lenders typically expect a down payment of 20 percent or more, so if you can swing it, that's the route to go. Not only will it make it more likely that your loan will be approved, but it can also help you snag a lower interest rate. But, of course, coming up with a 20 percent down payment can be a challenge, especially if you're a first-time homebuyer. If you don't have that kind of cash on hand, you may need to look into other options. Co-applying with a spouse can be one way.
Get your financial ducks in a row
Before you even start the home loan approval process, make sure you have your financial ducks in a row. This means getting your credit score in order, as well as having all the necessary documents and information on hand, and being up front about your income, debts, and assets.
Before starting your application make sure your credit report and score are accurate. Keeping your credit clean will help you get a low-interest rate on your home loan. Your income must be stable and consistent. If you are self-employed, then you must show that you are on track to continue generating income for the foreseeable future. The more information they have, the faster they can process your loan. The more prepared you are, the faster the home loan process will go.
Summing up
The housing market is challenging for almost everyone these days. It won’t be easy to get that perfect home loan package and get on with your home ownership plans. So, how can you shorten the time taken to get that home loan? Make sure you are ready by checking off your to-do list. Assess your EMI affordability before applying for a home loan, make a higher downpayment, and improve your credit score. These are the best ways to shorten your home loan approval time and get on the path to home ownership
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
