Not many people – especially those belonging to the middle income class or below – can afford to buy a house without borrowing. The tax advantages on home loans even tempt those in the higher income group to borrow to buy a house property.
However, the burden of extensive paperwork in the traditional home loan process and the possibility of multiple visits to banks cause a lot of problems to the loan seekers. The need for physical verification of all the documents and inclusion of several checkpoints in the loan approval process also cause much delay in getting a loan sanctioned. The physical process also makes monitoring and tracking the status of the application difficult.
Digital home loans tend to bridge these procedural gaps to a large extent and make the process more transparent and efficient.
Moreover, the digital push, first through demonetisation and later during the pandemic, has accelerated the technological revolution tremendously in India – leading to adoption of digitisation by people in their daily lives. Rise of fintechs – facilitated by advancement in digital technology and the convergence of finance and technology – has also made disbursals of digital home loans easier.
Pramod Kathura, CEO and Founder, Easiloan lists some of the benefits of applying online for digital home loans:
Ease of availability
The offers and products offered by various financial institutions can be digitally compared by borrowers, who can then choose the one that best suits their needs. For working professionals, going to a bank to learn about loan requirements and interest rates can be time-consuming and disruptive. As a result of these delays, it might also lead to delays and missed opportunities.
Additionally, a variety of platforms and channels, including the business website, customer portals, and even text applications, can be used to launch these applications. Based on comfort and ease of use, customers can choose their preferred option.
Once the product is selected, the traditional method of home loan application would entail multiple visits to banks for the purpose of document verification and submission, whereas borrowers in digital home loans can digitally upload their documents. In fact, almost all banks encourage the submission of digital copies. Furthermore, many institutions provide the option of document verification at home. As a result, the process can be completed from the comfort of one’s own home.
Furthermore, the websites of most of these platforms are simple to use. Instructions for completing applications or obtaining information are typically simple and self-explanatory, and they are typically available in multiple languages to accommodate users from diverse backgrounds.
Most of the steps and procedures in digital home loans are digitised, and the entire system is standardised. As a result, unnecessary delays are avoided. Applications, for example, can be completed and submitted in 8 to 10 minutes. Many financial institutions, in fact, guarantee loan approvals within 24 hours.
Flexible interest rates
Borrowers benefit from the added flexibility provided by digital home loans. For example, if the applicant’s financial circumstances change during loan repayment, the loan repayment terms and conditions can be changed with the assistance of an online executive. A trip to the bank and unnecessary commotion may not be necessary.
“The traditional method of applying for and securing loans has changed because of the incorporation of technology into the process. As a result, digital home loans have emerged as an appealing option for borrowers, owing to their numerous benefits. These include saving time and money, allowing flexibility in conditions during and after loan acquisition, and making it easier to compare and analyse multiple loan options,” said Kathura.