Finance

Is Aadhar Card Mandatory For Home Loan And Personal Loan?

3:58 AM Rajesh singh 7 Comments


Loans come handy, whenever you need funds urgently, or when you’re planning to buy property. Whether it is an unsecured loan, such as a personal loan for financial emergency or secured loan, your loan application is subject to the verification of necessary documents. These documents bear testimony to your identity, income and residence.

With Aadhar, the unique identification number becoming mandatory for all Indians, the question on every borrower’s mind, at the time of loan application, is, if Aadhar is also mandatory for loan application and if Aadhar online download will suffice.

Is Aadhar Mandatory?

Although lenders have not made Aadhar mandatory for borrowers to access any line of credit yet, there is no denying that loan processing can be accelerated with an Aadhar card. This is because, the document verification process reduces drastically when you provide your Aadhar card as an identity proof.

This is especially true of online or instant loans that are verified by using e-KYC based on Aadhar. Thus, if you are in urgent need of funds, you can avail an easy personal loan online by sharing a copy of your Aadhar.

Documents Required for Personal Loan and Home Loan

When applying for a Personal Loan or Home Loan, you need to furnish a set of different documents, which are required for the verification of your credentials. Here’s a brief lowdown on the different sets of documents required for Personal Loan and Home Loan.
The required documents for personal loan are:

       Identity proof (Aadhar/Voter ID/passport/driving license)
       Address proof (Aadhar/Voter ID/passport/driving license)
       Bank statements of three months
       Latest salary slip and Form 16

Unlike a personal loan, that is unsecured and for a shorter tenor, a home loan is a secured form of credit and a long-term commitment, which makes its documentation more comprehensive.

Apart from the above-mentioned documents, the required documents for home loan include:

       Certified proof of employment
       IT returns (3 years)
       Bank passbook and account statement
       Utility bills not more than 3 months old
       Insurance policy receipts and other investment proof
       Letter from a recognised public authority verifying your current place of residence
Self-employed individuals would need to furnish further documents such as
       Professional or business introduction
       Photocopy of registration of business
       Certificate of practice
       Advance tax receipts
       Balance sheet and profit and loss account of business

These documents, as mentioned above, need to be furnished as income and address proof that remains standard across lenders. Apart from these, you would also need to furnish the lender with a set of property documents that include the likes of the deed of sale, possession certificate, tax receipts, approved copy of the building plan, No Objection Certificate (NOC) from the housing society among others.

As mentioned earlier, whetting of your personal documents becomes easier for the lender, if you can furnish your Aadhar details upfront, as it is considered a universal identity proof. It will thus bring down your processing time. Do not fret if you do not have a hard copy of your Aadhar card handy as the Aadhar online download link can provide you access to get Aadhar card instantly, of which you can take a printout for submission.

What Purpose Does Aadhar Serve?

Until a decade ago, there was no uniform official ID in India This led to a number of complications in various levels within the Government and among the public at large.

With the introduction of Aadhar by the Government of India in 2010, a unique official ID has been created, which is considered the world’s largest biometric database. The presence of Aadhar makes everything from getting a SIM card for your phone to availing a loan easy.
Here’s why:

       As Aadhar is a valid proof of residence in itself, it removes the need for a lender to assess individual documents for identity and address proof. In the past, with each individual borrower submitting a different identity and address proof, the whetting process for lenders was not only lengthy, but also often led to discrepancies because of the sheer volume of documents to be handled.

       With Aadhar, the need to whet these individual documents is eliminated, and you can expect faster processing of your loan application.

Thus, if you are planning to take a loan soon or anticipate the need for credit in the near future, you are better off with an Aadhar card. Thus, when you make a loan application, all you have to do is furnish a copy of your Aadhar card.

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