What are the cons of applying loan from More then one bank other then processing fees - Indian Real Estate Forum

kirtikr · 03-08-11

Hi All,

What are the cons of applying for home from more then one bank except losing the processing fees. Can their be any legal action / remark in CIBIL report if you get the loan sactioned and do not collect the disbursement. Also till what stage can u ask the bank to cancel the loan sanctioning

vksharma2020 · 03-08-11

Personally I am of the opinion that ther should be no need to apply to more than one bank at same point of time. First we should do appropriate reseach, choose a bank and make application after that. However from CIBIL point of view there will be no implication. Case is reported to CIBILonly after you have consented to the T&C of saction letter of the loan. You cannot of course consent for more than one home loan at same point of time.

gharondabhai · 03-08-11

I would say, you must start the process with atleast three short listed banks...

Mind that, it is not the bank, it is the officer that you are working with matters the most. Some officer are professional and some are utter nonsense.

Hers is the tested process.

Talk to 3 or 4 banks

Ask for documentation requirements

Arrange the documents and submit soft copies to each of the bank

Ask them to verify the documents and confirm that all the documents are as per their wish list.

By this time, you already know whom you would like to work with... you know who is of your time and who are not.

Ask them to confirm positively that the submitted documents are enough for them to approve and disburse the loan.

They do any smart move, let them know that you have other options running in parallel, if they are not willing, lets not waste time.

Once you have gone through all these, you already know whom you would like to work with.

Don't bother too much about processing fees difference between different banks, the difference is peanuts in absolute term.

You pay processing fees only when you go ahead with a bank.

Unless you have no option, don't go for MNC banks or ICICI

If you know someone very closely in any nationalised bank (specially SBI) ... don't think anything else.

If you don't know and don't have spare time to waste then don't go for nationalised bank.

Once again, these are general observations.... it all depends on the bank officer you are dealing with.

Hope you got a clear idea.

Shashibg · 03-08-11

Very well suggested..it is all about the officer you are dealing with.
Another point that I would like to highlight here is that one needs to talk to friends/collegues etc who have dealt with a particular bank and understand how has their experience been. In case they can refer you to someone whom you know has been really good or someone who has simply been an idiot in dealing with them you know whom you can aviod.

kirtikr · 03-08-11

Thanks for the reply. My question is if I start the process in parallel from two banks, and at a later stage say No to One of those banks, what action can the bank take.

Quote:

Originally Posted by ondabhai

I would say, you must start the process with atleast three short listed banks...

Mind that, it is not the bank, it is the officer that you are working with matters the most. Some officer are professional and some are utter nonsense.

Hers is the tested process.

Talk to 3 or 4 banks

Ask for documentation requirements

Arrange the documents and submit soft copies to each of the bank

Ask them to verify the documents and confirm that all the documents are as per their wish list.

By this time, you already know whom you would like to work with... you know who is of your time and who are not.

Ask them to confirm positively that the submitted documents are enough for them to approve and disburse the loan.

They do any smart move, let them know that you have other options running in parallel, if they are not willing, lets not waste time.

Once you have gone through all these, you already know whom you would like to work with.

Don't bother too much about processing fees difference between different banks, the difference is peanuts in absolute term.

You pay processing fees only when you go ahead with a bank.

Unless you have no option, don't go for MNC banks or ICICI

If you know someone very closely in any nationalised bank (specially SBI) ... don't think anything else.

If you don't know and don't have spare time to waste then don't go for nationalised bank.

Once again, these are general observations.... it all depends on the bank officer you are dealing with.

Hope you got a clear idea.

gharondabhai · 05-08-11

Quote:

Originally Posted by kirtikr

Thanks for the reply. My question is if I start the process in parallel from two banks, and at a later stage say No to One of those banks, what action can the bank take.

As long as you have not entered into any agreement with the bank... they can take absolutely no action.

At the very very extreme case, they can blacklist you for any future loan. But generally, most of the banks do not have that kind of robust system in place or that kind of manpower who diligently does their work.

It is very simple, at any point of time, you can go to the bank and say you are not comfortable with them..
or give some imaginary excuse
or simply say that you dropped the idea to buy the house now, you will get in touch with them when you are ready .. that's it.

Isn't it the same thing they (banks) always do with you?

saihtul · 05-08-11

One quick question,
If we get loan approval/sanction only but do not go for disbursement....
Is processing fee still payable Or in other words, bank will not charge processing until I take disbursement.

gharondabhai · 06-08-11

Quote:

Originally Posted by saihtul

One quick question,
If we get loan approval/sanction only but do not go for disbursement....
Is processing fee still payable Or in other words, bank will not charge processing until I take disbursement.

You need to understand when the bank encash the processing cheque. Some clever one, like HDFC will first encash your cheque and then will issue approval letter .. disbursement is much later.

Some banks are not so smart ... or work more on trust ... these bank can encash processing fees cheque much later.

Legally, based on your loan application, you can stop your processing fees before the processing (Approval).

After the approval, you must have solid reason for stopping the payment (if not yet paid) or any refund. Bank can take action against you in case the amount involved is significant and they have the band width.

It is not ethical for you to stop payment after the approval unless there is a solid reason.

For this reason, many bank in overseas has something termed as "In Principal Approval" ... Indian banks are still unwilling to offer that ... so you have some right to play prank to them as well.

Hope this clarifies.

03-08-11	#1
kirtikr Member Join Date: May 2011 Posts: 60 Likes Received: 0 Likes Given: 1	What are the cons of applying loan from More then one bank other then processing fees Hi All, What are the cons of applying for home from more then one bank except losing the processing fees. Can their be any legal action / remark in CIBIL report if you get the loan sactioned and do not collect the disbursement. Also till what stage can u ask the bank to cancel the loan sanctioning

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03-08-11	#2
vksharma2020 Member Join Date: Nov 2009 Posts: 227 Likes Received: 72 Likes Given: 23 My Mood:	Personally I am of the opinion that ther should be no need to apply to more than one bank at same point of time. First we should do appropriate reseach, choose a bank and make application after that. However from CIBIL point of view there will be no implication. Case is reported to CIBILonly after you have consented to the T&C of saction letter of the loan. You cannot of course consent for more than one home loan at same point of time.

03-08-11	#3
gharondabhai Veteran Member Join Date: Nov 2010 Posts: 2,776 Likes Received: 569 Likes Given: 198 My Mood:	I would say, you must start the process with atleast three short listed banks... Mind that, it is not the bank, it is the officer that you are working with matters the most. Some officer are professional and some are utter nonsense. Hers is the tested process. Talk to 3 or 4 banks Ask for documentation requirements Arrange the documents and submit soft copies to each of the bank Ask them to verify the documents and confirm that all the documents are as per their wish list. By this time, you already know whom you would like to work with... you know who is of your time and who are not. Ask them to confirm positively that the submitted documents are enough for them to approve and disburse the loan. They do any smart move, let them know that you have other options running in parallel, if they are not willing, lets not waste time. Once you have gone through all these, you already know whom you would like to work with. Don't bother too much about processing fees difference between different banks, the difference is peanuts in absolute term. You pay processing fees only when you go ahead with a bank. Unless you have no option, don't go for MNC banks or ICICI If you know someone very closely in any nationalised bank (specially SBI) ... don't think anything else. If you don't know and don't have spare time to waste then don't go for nationalised bank. Once again, these are general observations.... it all depends on the bank officer you are dealing with. Hope you got a clear idea.

03-08-11	#4
Shashibg Member Join Date: Jul 2011 Posts: 83 Likes Received: 1 Likes Given: 0 My Mood:	Very well suggested..it is all about the officer you are dealing with. Another point that I would like to highlight here is that one needs to talk to friends/collegues etc who have dealt with a particular bank and understand how has their experience been. In case they can refer you to someone whom you know has been really good or someone who has simply been an idiot in dealing with them you know whom you can aviod.

05-08-11	#7
saihtul Member Join Date: Oct 2010 Location: Gr Noida Posts: 486 Likes Received: 15 Likes Given: 20	One quick question, If we get loan approval/sanction only but do not go for disbursement.... Is processing fee still payable Or in other words, bank will not charge processing until I take disbursement.