Loan from bank-Things to avoid to get loans easily from Banks
Banks operates in one the most risky business. They deal in money. Banks buy and sell money. Banks takes all possible care to avoid a faulty customer.
In present scenerio getting a loan is very tough thing. You have to meet many creterias to get a loan from Banks.
Here are the top things you should take care:
Your Worth on Papers to get Loan from Bank
You might be living in a five start house but what bank care is how much is your worth on papers. Even if you want a loan by securing a property, first thing bank will ask is your Income Tax return and Statement of affairs.
Bank asks your IT return to confirm you earnings and re-payment capacity. Suppose your annual income as per It return is 5 Lakhs. Bank will reverse calculate the possible EMI you can pay.
CIBIL Score to get loan from Bank
Your CIBIL score is the main creteria to assure you a loan. You might a good person but if your CIBIL score is below standard, Bank will reject your application. CIBIL score is the report card of your performance. CIBIL score is calculated by looking at your past performance of re-payment of loan or Credit card payments.
Banks does not ignore CIBIL score for the obevious reason, even if you rich why someone should give you a loan if you are not going to repay.
Proper Documents to get loan from Bank
Finally you should have proper documents to avail credit facilities from Bank. By proper documents mean all documents should be updated. Generally bank will ask latest bank statement, address proof and id proof.
Its adviced that you obtain address proof at earliest in city you move.
Why Banks ask IT return for income proof if we have enough security to pledge?
Bank will ask your income proof to check whether you are able to pay the EMI. Banks consider property only for ledge purpose but your income proof is main thing to secure you a loan.
It is very difficult to sell the property incase you dont pay the EMI. Banks dont want their NPA to go up, to have a lower NPA banks insist on income proof.
If you take a loan based on security, and dont repay the loan. Bank have to sell your secured property which is a very lengthy and money consuming task. Banks have to go for auction and property may not fetch enough money after paying the auction fees etc.
Also the rules are tough to auction a property.