Tips For Buyers If The Seller Is Still Re-Paying The Home Loan
If you are buying a resale property, chances are the current owner is still servicing his home loan. If that is the case, what could be the implications for you as a buyer?
First and foremost, the purchase process might take slightly longer than usual. The seller will have to pre-pay his loan and get the original documents released from his lender. After the seller pays his outstanding loan, the bank would take at least 10 days to issue a no-dues certificate along with all other property documents. In case you are using home finance to buy this property, the process might take even longer.
Why is that?
Since the seller has taken a home loan, all key documents of property are lying with the bank. The seller would only be able to produce photocopies of these documents for your perusal. In your best interest, do ask the seller to show a letter from his lender which states that he is the owner of the property against which he is servicing the home loan.
In case you are applying for a home loan to buy this property, you could go with the same lender as your seller. This would be less time taking and more convenient for you. How? The seller could help you get a better deal from the banks since he is an old customer. Also, since the bank already knows the property, it only has to know about your income and repayment capability to grant the loan. However, these should not be the only deciding factors when you take a home loan. If another lender is offering you a loan at a cheaper rate, apply for a loan there by all means. The idea must be to save money.