Buying a resale flat often makes more sense than booking a new one. It offers quicker possession, a well-established neighbourhood, and, in some cases, better pricing. But the biggest hurdle? Financing it.

If you're asking yourself questions like:

• Can I get a loan for a resale flat without too many hassles?
• What is the home loan process for a resale flat?
• Am I eligible, and how do I plan the EMIs?

Then this guide is for you. We’ll walk you through everything – from resale flat loan eligibility to the required documents and tax benefits – so you can make a confident and informed decision.

What Is a Resale Property?

A resale property is a previously owned home, unlike a newly constructed unit purchased directly from a developer. In this case, you buy the flat from its current owner. It’s ideal if you want to avoid construction delays and move in quickly. However, lenders may scrutinise the home loan process for a resale flat more carefully, especially if the property is older or if any critical paperwork – such as the sales deed – is missing.

Home Loan Eligibility for Resale Properties

Each lender applies different eligibility criteria, but here are some of the most common factors considered:

Income

You must show proof of steady income to ensure repayment capacity. If you're salaried, lenders will typically look at payslips and bank statements. Self-employed individuals may be asked to provide income tax returns (ITRs), bank statements, and CA-audited financial statements.

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Age

Most lenders require applicants to be at least 21 years old at the time of loan application and not older than 65 at the time of loan maturity. The older you are, the shorter your loan tenure is likely to be, which can impact EMI affordability. To improve eligibility and qualify for a longer tenure, older borrowers can consider adding a younger co-applicant who meets the income and credit requirements. A longer tenure can help reduce the monthly repayment burden, but bear in mind that it may also increase the overall interest costs over the life of the loan.
You can use a home loan EMI calculator to understand the relationship between EMIs, loan tenure, and interest costs, assuming the loan amount and interest rate remain the same.

Credit Score

To qualify for a home loan, your CIBIL score should ideally be 700 or more. A stronger score also improves your chances of securing a favourable home loan interest rate.

Key Documents Required

Before applying for a home loan for resale flats, get your documents ready. Missing paperwork can delay or even derail your loan. Here are the common documents required:

Identity and Address Proof:

• Aadhaar card
• Passport
• Voter ID
• Driving licence
• Ration card
• Latest electricity bill/piped gas monthly bill

Income Proof (for salaried):

• Salary slips (last 3 months)
• Form 16 (last 2 years)
• Bank statements (last 6 months)

Income Proof (for self-employed):

• ITR with income computation (last 2 years)
• Bank statements (last 6 months)
• CA audited financial statements

Property Documents:

• Sale Deed
• Property tax receipts
• Encumbrance certificate
• Society NOC

*Please note that additional documentation may be required depending on your individual profile or lender’s policy at the time of loan application.

Factors Lenders Consider for Resale Property Loans

Apart from the basic eligibility requirements, lenders may consider the following factors before disbursing your home loan for a resale flat:

Property Age and Condition

Older flats may receive a lower loan-to-value (LTV) ratio due to potential depreciation or higher maintenance requirements.

Legal Status

The title deed, past owners, and any existing liabilities are carefully verified.

Locality

A well-located flat with better resale potential reduces the lender’s risk. This can positively influence the home loan interest rate offered to you.

Strategies to Finance a Resale Property

To make your home loan journey smoother, consider these smart tips:

Plan with a Home Loan EMI Calculator

Use a home loan EMI calculator to explore different loan amounts, tenures, and interest rates. This helps you make informed borrowing decisions that suit your budget.

Increase Your Down Payment

Making a larger down payment reduces your loan amount and can improve your chances of securing a lower home loan interest rate.

Apply Jointly

Applying for a loan with a spouse, parent, or earning family member can boost your loan eligibility. A joint application may also help you qualify for a larger loan amount and enhance your tax-saving opportunities.

Tax Benefits on Home Loans for Resale Properties

Taking a home loan for a resale flat makes you eligible for several tax deductions:

Section 24(b)

You can claim up to INR 2 lakhs per financial year on the interest component of your home loan, provided the property is self-occupied.

Section 80C

You can claim up to INR 1.5 lakh per year on the principal repayment of your home loan.

Joint Loans

If both you and your co-borrower pay the EMI, each of you can claim these deductions separately (subject to individual limits).

How SMFG Grihashakti Can Help You Finance a Resale Home

Buying a resale flat can be a faster and more cost-effective way to own a home, but having the right financial partner is key to ensuring a smooth experience.
SMFG Grihashakti offers tailored home loans of up to INR 1 crore*, with competitive interest rates and flexible tenures going up to 30 years*. Further, straightforward eligibility criteria and minimal documentation requirements make the loan process smoother. Apply online today to start your journey toward homeownership!