The ‘personal discussion’ checklist for home loan

There is a certain anxiety one experiences before one meets the lender granting the home loan. The meeting popularly referred to as a ‘personal discussion’, can be hassle-free, if dealt with tact.

Getting a home loan entails putting many pieces of paper together for the lending company to help ascertain your demographic and financial situation. After this, the lender will seek to meet you prior to sanctioning the loan. This meeting is colloquially called the ‘personal discussion.’ The personal discussion is of crucial importance. Decisions regarding the sanction as well as the loan amounts are made based on this meeting.
Given the importance of the personal discussion, it is worth understanding the objectives of the meeting so that you are well-prepared.

To accurately assess income: While your income statements for the previous year(s) reveal the income, the lender would like to know if there are any other streams of income that you have that can be used to service the loan. These could include deposits or other instruments maturing, a property that you may be selling in the near future or any other income that is not reflected in your financial statements.

To estimate your worth: The lender will ask you questions regarding your assets and your plans with regards to each one of them. This is to estimate whether you have the ability to repay the loan even if there is some stress with regards to your regular income.

To understand your business: Self-employed customers have incomes that fluctuate. The lender will like to understand your business, its seasonality and your ability to manage any resultant stress. Based on this, he will form a view regarding your ability to consistently repay your monthly installments.

To ascertain your expenses: Each one of us has different lifestyles and different levels of expenses. The lender will understand this and determine the installment that you would be comfortable repaying.

Loans or other obligations: Any loans that you are currently repaying need to be taken cognizance of, so that your consolidated debt burden is reasonable.

Future prospects: Finally, the lender will understand the future prospects of your business or employment situation. This will determine not only the appropriate loan amount but also whether the option of monthly installment can increase in the future.

While there is no need to ‘prepare’ for the personal discussion, it is worth bearing a few points in mind:

Be honest: Like elsewhere in life, it pays to be honest during the personal discussion. Lenders have access to your financial statements and a lot of information is accessible on the internet. Further, it is a common practice to do reference checks with the industry or trade. So any lies or inconsistencies are easily found out and could adversely impact the decision to sanction the loan.

Do not conceal any information: This is an extension of the previous point regarding honesty. Your indebtedness, reputation in the market and virtually every other facet of life are verifiable. It is not worth concealing information for the sake of getting a loan. It is worth noting that lenders exchange information regarding potential bad or fraud borrowers among themselves, thus magnifying the impact.

Keep your documents handy: It will help expedite the sanction if you provide answers to all the questions and provide any supporting documents required.

Confidence: Finally, be confident. You are the customer and have access to many lenders in the market. You just need to talk about your financial situation with clarity and confidence. There is no need to get intimidated by the process.

To Know more about Prescon Realtors & Infrastructures Private Limited
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Address  :
201, Prestige Precinct, Near Nitin Casting, Almeida Road, Panchpakhadi, Thane (W), Mumbai – 400601.
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Email : prescon@prescon.in