If you are like most people, buying a home is one of the biggest financial decisions you will ever make. And for many people, taking out a home loan is the best way to afford that dream home.

Obtaining a home loan is a time-consuming procedure. But unfortunately, there are numerous roadblocks along the way. In this blog post, we will take a look at some of the common problems faced by borrowers. These concerns may range from being turned down to not getting the desired loan amount. We will also provide tips on how to overcome these problems. So if you are thinking about buying a home, be sure to read this blog post.

Real Estate Agents Vs Online Advertisement

When it comes to home loans, there are two main sources of information- real estate agents and online advertisements. While real estate agents provide in-person consultation and guidance for the home loan process, online advertisements are more easily accessible than traditional real estate agents. However, online ads can be misleading and do not always tell the whole story about home loans. This is where real estate agents come in handy. Real estate agents are able to help you understand your loan options better by providing an accurate picture of what is available in today’s market.

Real estate agents work hard to keep track of all the different types of loans available and can help you find one that will suit your financial needs best. Not only do real estate agents know about home loans, but they also have extensive knowledge on other aspects like down payments and the home buying process.

So which one is better? The answer to this question depends on your needs and preferences. If you are someone who prefers personal interaction and guidance, then real estate agents would be the best bet for you. However, if you want to do your own research, online advertisements will be a better choice.

Rejection at the First Stage

One of the most common problems faced by home loan borrowers is rejection at the first stage. It may be due to the age limit or financial requirements or required papers not being submitted during the field investigations conducted by the bank/Housing Finance Company, and so on. They are instantly rejected since the borrower’s qualifications do not match those of the lender.

The easiest approach to avoid being turned down in this way is to double-check the lending bank’s /Housing Finance Company’s eligibility standards and only apply to that institution if your situation meets their criteria. Before submitting an application, be sure to talk to your HFC loan advisor in-depth and double-check all of the necessary criteria.

Maintaining appropriate documentation, as well as providing correct, verifiable information to the lenders, will aid you in passing through the basic verification procedure. If you follow these tips, you will increase your chances of getting a home loan. Remember, it is always best to apply with multiple banks or NBFCs/Housing Finance Companies so that you have a higher chance of being approved.

Processing fee not refunded

When you apply for a home loan, the up-front processing fee is one of the expenses that you have to bear.  Please note that this fee is non-refundable.

Hence, be cautious when completing your application so that you don’t have to pay this fee over and over. Verify the paperwork thoroughly, and if you are unsure about anything, ask your loan advisor for clarification. Incomplete or inaccurate applications can lead to processing fees being charged multiple times, so be sure to take your time and fill out the application correctly.

Make sure that you read the terms and conditions of the home loan agreement carefully before signing it. This will help you avoid any surprises later on.

Desired loan amount not sanctioned

Another problem that home loan borrowers face is not getting the desired loan amount sanctioned. This may be due to a number of reasons such as inadequate income, the lower technical value of the property, poor repayment track, other outstanding loans, and so on.

In order to increase your chances of getting the desired home loan amount sanctioned, it is important that you provide complete and accurate information to the lenders. Also, maintain updated documentation so that the verification process is smooth.

The interest rate dilemma

One of the most important factors that home loan borrowers need to consider is the interest rate. It can have a significant influence on your home loan agreement. So, it is important to be aware of all the different interest rates available in the market. Deciding whether to take out a home loan with a fixed or floating rate interest rate is a question that almost every homeowner must confront.

You should also consult with a financial advisor to understand how fluctuations in the interest rate will affect your monthly payments and the overall cost of the home loan. This will help you make an informed decision about which interest rate is best for you.

It is also important to keep in mind that the interest rates vary from time to time. So, it is important to stay updated on the latest rates before applying for a home loan.

The difference in property valuation

Property valuation is a key parameter during the Home Loan appraisal process. Banks and Housing Finance Companies can lower the sanctioned amount based on the value of the property. Property valuation is the process of determining a property’s worth based on many variables like the age of the property, its condition, construction quality, where it is located, and whether it has been approved/unapproved, etc. Banks and HFCs consider these factors when assessing the property, and they will only lend you the amount that is predicted by their estimate. It might lead to a significant disconnect between your expectations and what the bank is prepared to offer.

In order to avoid this situation, make sure that you get an updated valuation of your property before applying for a home loan from a valuator who is approved by your bank/HFC. This can save you from any last-minute discomfort.

The Down Payment

One of the biggest problems home loan borrowers face is the down payment. Most banks/Housing Finance Companies require a down payment of at least 10% of the total property value. This can be a major obstacle for first-time homebuyers, who may not have saved enough to make such a large payment. You would pay the down payment as Banks/Housing Finance Companies are not allowed to fund the entire value of the property.

The simplest solution to this problem is to keep the down payment ready beforehand. If you want to get a home loan, it’s generally a good idea to search for down payment requirements at various lenders and select the one that suits your needs.

Title deeds and NOC documentation problems

Another common problem home loan borrowers face is when the title deeds or NOCs (No Objection Certificates) are not in order. A NOC is a certificate that shows you have the required permissions to do a particular thing. It is important to obtain a NOC from the local authorities before undertaking the construction of any building. The authority inspects the land for possible obstacles or impediments and it may also conduct an environmental assessment. This can be a major hurdle in the verification process and can lead to your home loan application getting rejected.

There are several reasons why this might happen, such as incorrect documentation, incorrect property details, forged documents, and so on. In order to avoid this, make sure that you have all the correct documentation ready and get it verified by your lender before submitting your home loan application. The title deeds and NOC papers must be submitted in the bank’s format.

It is also a good idea to keep an eye on property transactions in your area so that you can be prepared if any such problem arises. If you do find yourself in this situation, take immediate action and get the correct documents verified by your bank/Housing Finance Company. This will help speed up the process and ensure that your home loan application is not rejected.


These are some of the most common problems home loan borrowers face when trying to get a home loan. By being aware of these issues and taking the necessary precautions, you can avoid them altogether and make the home loan application process smoother and easier.

Stay updated on the latest rates before applying for a home loan. It’s essential that you understand the terms and conditions of your home loan so you can avoid such a scenario.

For more information, visit Shubham Housing Finance’s website or get in touch with one of our expert advisors.