Housing Loan in India Does a house loan in India entail the need to file for ITR?
It needs considerable investment to build or purchase a house. Whether it’s a rented apartment or an independent villa, the purchase amount could run into lakhs, if not crores. That’s not an amount that people usually manage to save; for most of us, instant purchase of a house isn’t a possibility.
That’s where you are required to apply for a housing loan. A home loan is the most feasible option as it provides you with the required funds while granting you a long tenure to pay back the amount. You can now apply online for a housing loan and get an instant e-sanction.
How to get a Home Loan in India?
To get your home loan application approved, you need to prove your eligibility. For this, different vendors have their own housing loan eligibility calculator where you can check how much home loan you can take. But in all cases, you’ll be asked to submit the following documents.
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Your KYC documents (address/identity proof)
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Salary slips
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Bank statements
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Property documents
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Copies of your income tax returns (ITR)
Note that filing ITR is essential if you’re applying for a housing loan in India.
Why is ITR required for a Housing Loan?
Income tax return or ITR acknowledges the return of your taxes that you have filed with the Income Tax Department for any particular financial year. Therefore, while applying online for a housing loan, ITR is one of the most crucial documents required if you plan to or make other business transactions.
Here are a few reasons you must file your ITR before requesting a housing loan in India.
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ITR is an essential document through which your lender can assess whether you’re eligible for the loan. In addition, most vendors require ITR for the previous three years (or more) to process your loan application.
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If you haven’t filed your ITR or paid your taxes, no vendor will be willing to accept your application for a home loan. Failure to pay taxes shows that you’re financially unstable.
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Make sure your ITR reflects stable income levels over the past three years. It’s preferable if they show a consistent rise as it’ll assure the lender that you have a steady income and can repay your EMIs on time.
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Another primary document is a net-worth statement, for which you need to provide your ITR details. You will not be able to apply for the loan without these financial documents.
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If you are a salaried employee or own a business enterprise, your vendor would like to see audited finances to process your application. To get your documents audited, you must have filed ITR and paid your taxes on time.
Conclusion
Many factors, including your ITR record, are considered for a house loan. Only in exceptional cases do lenders approve housing loans without demanding ITR. Therefore, you should submit the ITR requirements to your lender. Lastly, don’t forget to check the housing loan eligibility calculator of the particular vendor you’ll be approaching for the loan.
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