The cost of the plot to you or the current market value, whichever is lower, will also be taken into account to work out the total cost of the project. The bank will decide the home loan amount based on this total cost. The loan will be released in parts, based on the progress of the construction, and after you have brought in your full margin. The bank may insist on sending its own technical personnel to assess the progress of construction or may rely on certificates/photographs submitted by you. Some banks are not comfortable funding self-constructed properties and hence, you will need to take that into account while finalising your lender.

This is possible if your monthly income is above Rs 10,000, or if you are a practising professional. But personal loans being expensive and for a short tenure, are likely to drain your monthly resources. Take this option only when you have resources to pay off the personal loan from sources other than those taken into account for your home loan.

This power of attorney would also give the power to the buyer to further provide such power of attorneys to other people (for other buyers in the future). Most banks do not encourage such transactions, since the ownership is itself suspect in such a transaction. Such transactions are normally entered into to save on charges payable to the development authorities as well as stamp duty and registration charges. Home loans to buy such properties may be available from a restricted list of home loan lenders, who may also lend at higher interest rates.

In actual practice, however, it is difficult to estimate the monthly expenses of each borrower separately. Which is why banks use a pre-determined percentage of your income as being available for paying the loan installment, based on their past experience as well as available household expenditure data. For instance, a bank may assume that if your income is Rs 20,000 per month, 40 per cent of that (i.e. Rs 8000) will be available for repayment. Then, they calculate the loan eligibility accordingly.

Some banks allow parents and children to be joint borrowers, while a smaller number of banks allow brothers to be joint borrowers. The reason for the restrictions is that in the event of some dispute arising between the joint borrowers, the income stops getting pooled and there may be a problem in paying the loan installments.

The bank will not fix this rate arbitrarily, since it affects its cost of funds as well as availability of funds. Unfortunately, even this kind of transparency in floating rate is not easily available in India.

PPC - Pre Payment Charges or PPC as it is known stands for the charges that you incur when you pay back the loan before the completion of the tenure. PPC varies from one HFI to another. It is either a percentage of the loan amount being prepaid or a flat value based on the amount of prepayment.

Your employment details: If your company is not well-known, then a short summary about the nature of the company, its business lines, its main customers, its competitors, number of offices, number of employees, turnover, profit, etc may be needed. Usually, the company profile that is available on the standard website of the company is enough.

At this stage, in some cases, you may discover that the original documents have yet not been received by the bank from the registrar. In such cases, you will need to follow up with the registrar and get the documents from them directly by showing them a copy of the banks clearance certificate.

Income on RBI Tax Free Bonds, Interest on Public provident fund, gifts received from specified relatives or on the occasion of marriage (from anyone) or under a will, etc.