Property Document Checklist: A guide for home buyers

When you decide to buy a new residential property, it is crucial to have knowledge about the property documents involved in the process. Most often, a first-time homebuyer is unaware of the paperwork required for closing the deal. Collecting and thoroughly reviewing the documents is an essential step in the final procedure. This guide aims to provide you with a property documents checklist needed to successfully buy a new home! 

Property Documents Checklist for Resident Indians:

1. PAN Card

An applicant’s Permanent Account Number (PAN) is an important document for all transactions, including buying or selling a property. Ensure that you have a copy of the same, along with another ID proof, such as a driving license, passport, or voter ID. 

2. Residence Proof Document

A valid and acceptable address proof is also an important document required for buying a home. Commonly used documents include passport, voter ID, utility bills, driving license, Aadhar card, etc. 

3. Bank Account Statement

Similar to salary slips, finance companies will also ask applicants to show a copy of their bank account statements for the past 6 months or so. This is also an important document required for buying a home from the loan lenders’ perspective, as it will determine your eligibility for a home loan. 

4. Employment documents 

For salaried employees: 

• Letter of Employment: To avail a home loan, the loan lender will require you to show some proof of income. While tax returns and payslips do count as proof of income, some lenders may also require a letter to verify other documents. The letterhead must include the date of joining, current designation, employment status, and income details. 

• Monthly Salary Slips: Lenders will require salary slips to determine your eligibility for a home loan. The applicant can arrange this by providing the latest 3-month salary slips.

• Form 16: The property documents checklist for salaried employees also includes Form 16 – a document that must be provided by the employer. The document gives the lender the assurance of the applicants’ continuity of salary. It also certifies that the income tax from your salary has been deducted at source. 

• Other relevant documents: These include a copy of your employee ID, company’s offer letter, previous employer’s relieving letter and experience letter as well. 

For self-employed individuals:

• Proof of Business Existence: In some cases, finance companies require proof of the existence of a company. It is a document that shows a valid business license/ registration issued by a government authority. 

• Audited Profit and Loss Sheet: The profit and loss (P&L) sheet can provide details about the profitability of the business. This gives the lender a better understanding of the total income generated by the business to determine home loan eligibility. 

• Balance Sheet: A statement that represents your company’s finances (liabilities, assets, total net worth) is an essential document to determine the financial position of your business.

5. Income Tax Returns

Most finance companies have a minimum requirement based on the tax bracket your income falls under, to be eligible for a home loan. Thus, if you plan on buying a home, you must be diligent with filing your IT returns. In most cases, you will be asked to show the IT returns record of the past 2 years or so. 

6. Loan Details

You will be asked to provide existing loan details and the status of the loan/ existing debts (if any). Based on this information, the loan lender will be able to finalize your home loan application. The lower the existing loan, the higher the chances are for securing a housing loan. 

In a nutshell, it is important to check property documents before buying a property. If you are looking to buy/ invest in a home for you and your family, we at Assetz Property Group have compiled a detailed guide on securing a home loan to ease the process for you. We have also created a blog on NRIs looking to invest in real estate, keeping in mind all homebuyers.

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