WHY BANKS MAY REJECT YOUR HOME LOAN APPLICATION

What is Home Loan ?

Home loan is important source of finance for buying a home. It is important to ensure that your home loan is affordable for you and you are comfortable to repay them. Home Loan is a Secured Loan offered against the security of a real estate property which is funded by the bank's loan, the property could be a personal property or a commercial one.

Loans are provided based on the market value, mainly estimation given by banks or the registration value of the property.
Once a lender/banker is comfortable with your EMI payment capacity, the lender will figure out the total loan that can be given to you. Generally, bank expects that you will pay at least 15% to 20% of home purchase price amount as the down payment. The remaining 80% to 85% is the loan that bank will give you.
Please Note: if the borrower is failed to pay back the home loan, the banker can retrieve the lent money by selling the property.

WHY BANKS MAY REJECT YOUR HOME LOAN APPLICATION

Here are some little known parameters used by banks to decide your loan eligibility and how you can ensure you meet these. If you're planning to buy a house, you've probably begun exploring how and where to get a home loan. Your research will have pointed out the most essential factor that will help you get one-a good credit score. If you had never bothered to check your score before, you must be busy ensuring that you get a high one. A good way to do this is by paying your credit card dues in full and on time. In case you want a substantial loan, you will also have to increase your income level and pay all your previous outstanding loans. These are not the only reasons your loan application could be rejected. There are several others factors that could influence this decision; for some of these you may not even be responsible directly. However, you need to be aware of these, so that if such a situation arises, you can tackle it and obtain a loan without any botheration.

Factors of Home Loan Rejection

1. Are You Compulsive Job Hopper

It is a common practice among the current generation to switch jobs every couple of years. This, One case of banks, implies instability and could become a reason to reject your loan request. Banks place a high value on job stability and often insist that an applicant needs to be employed with a particular company for a certain minimum period to be eligible for a home loan. This period usually varies from one to three years.
Tip: Stick with a company for at least a year if you are planning to apply for a loan. If you want to switch jobs, do so after your loan is sanctioned. This minimum time period is acceptable only during the initial years of your career. As you gain experience, it will be better if you work for a longer period, say, more than three years, at a company to

2. Your Residential Address is on the Defaulter List
If you live in the same house as someone who is a loan defaulter, it's probable that your residential address is on a watch list, which could lead to your loan application being rejected. The defaulter could be a tenant, relative or a family member, who may have slipped up on a loan payment or may not have paid his credit card dues and, hence, was reported to the national credit bureau.

Tip: Take up this issue with your relationship manager at the bank. Indicate that the previous tenant (if it is the case) does not have a personal relationship with you. In case of a family member, you will need to stress that he or she is not dependent on you.

3. Your Profile Doesn't Fit the Bank 's Policy
Each bank is guided by its internal policies. If some income or debt profiles or geographical areas are listed in their policy guidelines as not appropriate for lending, the bank will not be able to fund your loan.


Tip: In case your credit profile does not fulfill the criteria listed by the bank, you could provide additional security. This could be in the form of a guarantor, a co-borrower who has a high credit score, collateral such as insurance policies, fixed deposits, stocks and mutual fund portfolio, property, or proof of your repayment ability (in case you run your own business). If the area you live in is outside the geographical limit that is specified by the bank, you should try applying to the nearest bank or branch in a location that is on the bank's approved list.

4. You Want to Purchase an Old Building
Some banks do not lend money if the apartment or house you want to buy is more than 20-30 years old. This criterion, that is, the age of the building, varies across different banks.
Tip: The value of the land will always be considered while deciding on the funding for older buildings. Try to increase the down payment and add some form of security to negotiate for a lesser loan amount.
5. Your Application has been Rejected Earlier
Most banks have records of all rejected loan applications in their database. When you apply to a bank, this will show up in your application verification check and pose a problem as it affects your loan worthiness.
Tip: Weigh the pros and cons before you apply for a loan simultaneously at different banks. It is best to wait till you know you cannot receive a loan from one bank before you apply to another. This will give you a chance to rectify errors or update your credit records in case there is an issue with it before you approach another lender. If the reason for your previous loan rejection is other than a default or due to a reason that is unclear to you, it up with the bank and find out the exact reason for the rejection. In certain cases, the bank may be willing to reconsider its decision.

Demand for home loans going Slow

Banks and housing finance companies are seeing a slackening in demand for home loans. Prospective buyers are postponing decisions on expectation that the high property prices will cool off. Further, the gradually rising interest rates are also acting as a demand dampener, say market players.

Though numbers are not forthcoming from lenders, officials from three credit information bureaus Business Line spoke to have traced a clear trend of receiving fewer home loan applications for verification from banks and HFCs (housing finance companies) in the last few months.

The slackening trend in demand for home loans is more pronounced in metros such as Mumbai and Delhi where property prices have touched unrealistic peaks, said experts.

The demand for home loans has declined in the past three months, said Mr Anil Kothuri, Executive Vice-President, Edelweiss, who heads the Retail Finance division of the company.
�Although the runaway increase in property prices has taken a breather, it has not declined. Hence, home buyers probably feel that it is worth waiting to make up their mind about buying houses, Mr Kothuri said. Edelweiss home finance currently has operations only in Mumbai.
RBI data
Data released by the RBI, until February, does not show any slowdown in month-on-month growth in the home loan portfolio, said Ms Vibha Batra, Co-Head - Financial Sector Ratings, ICRA Ltd.
However, fewer home loan enquiries may be an early indicator of a slowdown in demand for home loans; with demand slowing because of high property prices and increasing interest rates. This may get translated in RBI data by May-June as new sanctions get converted into disbursals in 30-45 days and the RBI data come with one month lag, she added.

Mr S. S. Mundra, Executive Director, Union Bank of India, agreed that there has been some slowdown in home loan demand due to high property prices. The slowdown is seen more in regions like Mumbai and Delhi than in South India. People are preferring to wait for some more time in the metros before they take a decision to purchase a house,he said.

According to Mr Monish Shah, Director, Deolitte, India housing finance companies and banks are seeing a slowdown in demand for housing loans.
�Usually the two main reasons for a slowing of demand for housing loans are property prices and interest rates. But I feel this is more to do with prices. Over the past few years realty levels have increased so much that the monthly payment is not as big a challenge as the initial capital for home buyers,� he said

Fast Cash Advance Loans

Are fast cash advance loans also known as payday loans worth the cost? Well that largely depends on the situation. There are many instances where this type of short-term loan makes financial sense however there are also many times where it is a bad decision.

When does a fast cash advance loan not make financial sense?

Payday loans are designed to solve short-term cash flow problems and should be paid back as soon as possible. You should only get this type of loan if you desperately need fast cash. You have to separate your needs from wants. If you want money before your next payday to make purchases on material items than you should just wait until your next paycheck.


When does getting a fast cash advance loan make financial sense?

A basic rule of thumb to use in that if the cost of not getting the payday loan exceeds the cost of the finance charge on the loan then it makes financial sense. Late fees on credit cards, mortgages, car payments, and bounced checks all carry fees which range from $25-$75 and can easily surpass the finance charge on the payday loan.

Unexpected events happen all the time in our lives that leave us in desperate need for fast cash. Whether it is an automobile breakdown, a death in the family, unexpected bills, or a hospital visit, these things happen and often times we don't have enough money to cover the initial expenses. This is where a fast cash advance loan can be a big help.

Before taking out a payday loan it is important to realize that these short-term loans carry above average interest rates and should not be overused. They are however a great fallback option when you are experiencing short-term cash flow problems and are wanting an advance on your paycheck.

You must be at least 18 years old and working at a job that makes at least $800 per month to qualify for most payday loans. Most lenders also require that you have a checking account that allows direct deposit. This is so they can easily deposit funds directly into your banking account and remove them on the agreed upon payback date.

Most online payday loan lenders can deposit your requested funds directly into your banking account withing 24 hours of your application. Retail outlets may take longer depending on your situation. Again, make sure you really NEED a fast cash advance loan instead of just WANTING money before your next payday.

Instead of waiting in line at your nearest cash advance location it is much easier to apply for a loan online. Using a matchmaker service such as CashAdvanceSelector.com is the most convenient way to obtain fast cash before your next payday. They are one of the biggest and most respected payday loan matchmakers in the industry. It is a completely free service and typically customers are able to get a better rate than going directly to a lender because multiple lenders are competing for the loan rights.

Payday Loan on Christmas Eve?

It's a situation that most would want to avoid at all costs, but what happens if you run out of money on Christmas Eve? Maybe you've spent too much on presents, maxed out the credit card buying Christmas dinner or an unexpected bill came at just the wrong time. You can't turn to the banks, they could take days to provide a decision and you might not see any cash until the New Year. The only viable solution for many is to take out a payday loan.

The good news for anybody who finds themselves in this situation is that it's just as easy to find a payday loan on Christmas Eve as it is on any other day of the year. In fact, if you needed to, you could even decide to delay until Christmas Day or Boxing Day; by finding a lender that offers loans every day of the year, you can get a decision and have the money in your account as quick as you would on a normal day.

This is the kind of convenience and versatility that has helped to create a huge spike in payday loan applications throughout the course of 2011. As a form of emergency borrowing it is very difficult to beat. Available 24 hours a day and 7 days a week, it's open to almost anybody in stable employment, regardless on your credit history. Invariably this has assisted in the rising popularity of payday loans, but has also opened the door to misuse.

Even if you find yourself in a really tight spot on the day before Christmas, it's still important that you consider the consequences of borrowing money and ensure that you have the funds available to repay on the agreed date. The availability of a loan doesn't necessarily mean that you have to take up the option, or rush into anything. This shouldn't serve to deter you, but it is very easy to get trapped in a cycle of debt due to over-spending and borrowing beyond your means, so it is always worth bearing in mind.

One of the primary reasons that payday loans are more accessible, particularly when compared with other forms of credit or loan, is that the whole industry is almost entirely based online. When you have to go through manual, offline methods everything slows down. You also only have the option to apply when the company is open for business, which generally doesn't include public holidays or late nights.

With it being a short-term borrowing option with very strict limits on how long you can borrow until the repayment is due and how much you can access, there isn't a major requirement for lenders to be overly stringent. Some checks will be employed, but these are largely automated and can be completed within minutes. Most won't even ask you to fax supporting documents, removing another potential hurdle. Again, this all helps to improve the accessibility of loans and facilitates a smoother process from start to finish.

So if your finances won't stretch beyond December 24th, don't panic. Whilst there will be some payday loan companies that operate during set times, most will still be able to process applications and transfer cash as if it was any other day. Make sure you double check before applying, particularly if you're in a rush and need the money within a day or so to carry on your festive celebrations. It should be quick and easy to do and you can repay the money when your salary arrives in the New Year.

How to Get a Car Loan

You just completed filing for your bankruptcy; it's been discharged and now you have a problem. Your car just died and you are in need of a car loan after bankruptcy. This can seem challenging especially after all the stress and confusion of filing for chapter 7. You may be afraid to go to a car dealership because you're afraid of being denied and laughed off the car lot. Luckily, I have good news for you folks.

Obtaining auto financing for a car loan after bankruptcy is a lot easier now that your bankruptcy has been discharged. Many individuals use automobile loans to begin rebuilding their credit and you can too. By searching for an auto loan online you can receive multiple offers from multiple lenders all within 60 seconds or less.

If you have had any bankruptcy that has been discharged within one year, most lenders and car dealerships are not going to be welcoming you with open arms. They know your bankruptcy will remain on your credit history for 7 years; so chances are the dealers financing company will not want to deal with you. The good news is, there are many lenders willing to overlook this problem and give you a chance to start over again. If you can afford to make consistent monthly payments it is possible to be approved for a car loan after bankruptcy. Quite a few individuals are rebuilding their credit the smart way. Having proved themselves by keeping their car loan payments up to date has improved their credit history significantly.

There are legitimate lenders on the Internet that will offer you a number of auto loans to compare once your bankruptcy has been discharged or dismissed. Don't expect to pay a 3% interest rate, but you will find multiple offers with various rates that you'll be able to compare and you will have options to choose that will fit your individual budget. From the comfort of your own home, you can find the best car loan after bankruptcy and begin to rebuild your financial history. Reasonable financing with reasonable terms is only a mouse click away.

Keep in mind the fear of walking into a dealership and getting denied is a thing of the past. Walking into the dealer with a pre-approved auto loan in your pocket will make you a VIP customer in their eyes. The lenders are aware that many folks use this method to rebuild their credit and the dealerships are more than willing to be a part of your financial rebuilding plan. Just make your choice and drive away with your new car or truck. Your new ride can be parked in your driveway by the end of the day.

How to Get an Auto Loan Fast, Even After Bankruptcy:
Believe it or not, you can get a fast auto loan REGARDLESS of your credit. Visit Best Bad Credit Car Loans to receive FREE quotes from the top 3 service providers. In fact, you could qualify for a car loan in as little as 24 hours, even if you've been turned down before. Best of all, there is absolutely no obligation whatsoever.

USA Home Mortgage Basics

Are you in the US and trying to purchase a home? There are some things that you need to remember when getting a USA home mortgage. In this short article, you will discover the basics to mortgages, and discover how to get the finance you need!

There are a lot of lenders out there, that can help you to get your USA home mortgage fast. However, there are some points to remember. Yes, there may be a lot of different lenders, but for many people, they don't know the differences. It is like a foreign subject! However, there are some solutions, and this article aims to help you to do that!

Discovering the information you need is essential. To begin, you need to know what you are about to get yourself into!

The first point to remember, about the different packages, is that they generally will run for 30 years, though there are some options for 50 year terms, and there are options for different time frames in between.

Remember, the longer the finance runs for, the more likely, the more expensive it will be. When you consider a USA home mortgage, you are expecting to have finance that runs for decades, so this is a big cost! The less time to pay, will result in bigger savings.

So, please look for the offers that you are able to pay for the fastest. There is no doubt that the 50 year finance will run for a long time, in which you would end up paying more for the interest, than the actual home!

Another point, is the adjustable rate mortgages, and the fixed rate mortgages. The result is that you can actually go through and get the finance that you need.

Adjustable versions change when the banks change the base rate of interest. While the fixed versions run throughout the term.

The choice you make, will come down to your individual needs. So, invest some time into research. There are many lenders that have web sites, and even advertise on billboards. With these range of options, you should be able to find the finance that you need, to be able to purchase a home, fast!

There is another option, and that is the USA home mortgage brokers. These guys represent different lenders, and packages, and can be a great way to find the best mortgage packages fast. All you need to do, is to look for a broker who has a good list of lenders and packages that they represent.

With so many options, you have a good chance to find the best USA home mortgage for your needs. Add research into this equation, and you will be well on your way to finding the best options to purchase a home with!

USA Mortgage Brokers

To supervise the work done by all the mortgage brokers in Arkansas, the state government has introduced some new rules and regulations. Now, the entire American mortgage brokers of Rogers, Arkansas, are supervised by the Arkansas State Department. This applies even if the mortgage broker is a member or a subsidiary of any commercial bank or financial institution in Arkansas or of a bank outside of Arkansas. If the State Department doesn't do it, then the office of the controller of currency has the authority to supervise them or the state where the financial institution is chartered will do the supervision.

Now all independent American mortgage brokers of Rogers, Arkansas, have to pay some amount of money to keep their registered status active. The fees include a nonrefundable amount of $750. This is only for the main office. The applicant has to pay $100 each for every branch office that he wishes to apply in. Besides this, the American mortgage brokers of Rogers, Arkansas, also have to pay an annual renewal fee for their license. This amount is of $350. Besides this, the applicants have to furnish a surety bond of $50,000 and also should have financial assets worth $25,000 or more. The application is approved only once all the documents are verified and a good thorough examination is carried out.

So if you are looking for American mortgage brokers of Rogers, Arkansas, you can be assured that these guys are legal and will not indulge in any kind of fraudulent activity whatsoever.