Documents Required for Real Estate Finance:
Firm/ Constitution:
1. KYC
2. 12 months Account Statement
3. 12 Months GSTR-3B
4. Last 3 years Financial
5. RERA & Project Approval
6. Constitution Estimate
7. Property Papers
Promoters:
What Is Real Estate?
Real estate is defined as the land and any permanent structures, like a home, or improvements attached to the land, whether natural or man-made.
Real estate is a form of real property. It differs from personal property, which is not permanently attached to the land, such as vehicles, boats, jewelry, furniture, and farm equipment.
The Essentials of Real Estate Finance
Real estate finance is a branch of finance that focuses on how people purchase real estate, whether that be a home, an office building or a plot of land.1 This area of finance involves the analysis, planning and management of financial resources related to real estate, commercial loans and properties. It also includes financial processes around real estate, such as acquisition, development, construction and operation of commercial and residential properties.
Real Estate Financing provides integrated financial solutions to real estate developers with a focus on residential project financing such as funding real estate developers at various stages in the life cycle of a real estate project.
Real Estate Finance: Mortgage Loans
Traditional or conventional mortgages are the most common form of real estate loan available. Some characteristics of a conventional mortgage are the following.
- Payment terms are offered in a set number of years. Mortgages are offered in 15, 20, or 30-year payment terms, and the term length determines some of the cost of repayment.
- The amount of each monthly payment is determined by a few factors such as debt-to-income ratio, financial history, credit score, and interest rate.
- Mortgage insurance, which is protection for the bank against loan default, may be required if the buyer cannot make a down payment of 20% or greater.
- Interest is the cost of borrowing money. It is the extra amount a lender charges on top of the principal amount being borrowed. It is determined based on credit history and mortgage term length.
Some of the advantages of a traditional mortgage include the following.
- Private mortgage insurance (PMI) is not required as an additional part of the monthly payment.
- In times where interest rates are lower, an adjustable-rate mortgage can keep payments low.
- There is an option to make interest-only payments for a period if the property is a short-term investment.
- Only one mortgage is needed for owner-occupied properties where the owner leases space to tenants in their residence.
- Homebuyers pay less over time because of the higher requirements to secure the mortgage.
