A Guide on How to Get Home Loan on Power of Attorney

The process of getting a home loan can be a bit complex, and it includes a lot of formalities. One of them is getting a power of attorney. If you are unable to manage the process in person or you are an NRI living abroad, then appointing a power of attorney can be very helpful for you. 

In this guide, we have discussed the process of how to get a power of attorney for a home loan. There is an overview that includes the types of PoA, documents required, step-by-step process, and the benefits of securing a PoA for a home loan. 

What is a Power of Attorney?

A power of attorney is a legally valid document that allows one person (known as the principal or grantor) to authorize or give the powers to another (known as the agent or grantee) to act on their behalf in certain matters. In case of home loans, PoA is used for tasks like signing the documents, managing legal processes, sale deeds, and making decisions related to the property.

There are two types of PoA for home loans that you can use:

1. General PoA: General power of attorney grants a broad range of powers to the agent for managing the activities related to properties, such as selling, buying, leasing, or managing them.
2. Special PoA: This PoA grants the powers to the agent to complete a particular task. These tasks can include registering property and applying for a home loan, among others. Among the two types of Indian PoA, this one is widely used because it gives limited powers to the agent.

Why Get a Power of Attorney for a Home Loan?

There are many reasons to obtain a power of attorney for a home loan, and it can be beneficial:

• NRI home loan applicants: It has proved to be the best thing for the NRIs because they cannot always be present in India, so they can appoint their trusted friend or relative as their agent via PoA and authorize them to handle their home loan process. 
• Medical or personal reasons: In some cases, when the health issues or personal problems are the reason that you cannot manage the home loan process directly, you can draft a PoA document. 
• Frequent travellers or busy professionals: If you are an individual with a busy schedule, then giving the specific tasks to a trustworthy grantee through a power of attorney will be helpful.

Steps to Get a Home Loan on PoA

Here is the step-by-step guide on how to get power of attorney for a home loan:

1. Determine the types of Indian PoA 

First of all, you have to determine which type of PoA is needed from the two types: Specific PoA or General PoA. Although for home loan purposes, you should opt for a specific PoA because they grant the powers to the agent for a specific purpose related to the loan application and property transactions. 

2. Draft the document of PoA

You need to draft a document that is legally sound and valid. You can either take the templates from the online websites or consult a lawyer for the same. The document should clearly mention the powers that you are granting to the agent and the other details, like validity, to avoid misuse.

3. Get the notarization on the PoA

After drafting the document, have it notarized by a public notary to make the document legally valid. The notary helps in verifying both parties and witnesses the signing process of the document.

4. Register the PoA (if necessary)

In some of the cases, the PoA needs to be registered at the local sub-registrar's office. If you are an NRI, it is compulsory to have it attested by the Indian consulate in the country of your residence, and then you must get it registered in India.

5. Submit the PoA to the lender

After you have completed all the processes of getting the power of attorney in the home loan scenario, you have to submit it to the lender. After verifying the document, the financial institution or bank will confirm that the appointed agent can act on your behalf during the home loan process.

Documents Required to Get a Home Loan on PoA

It is essential to be aware of the documents required to obtain a power of attorney for the home loan process. These documents are listed below:

• Valid identity proofs of both the principal and the agent (including Aadhaar card, a passport, or a PAN card). 
• Proof of address of both parties. 
• Drafted Power of Attorney.
• Recent passport-sized photographs.
• Proof of the relationship between the grantor and the grantee, if required.
• For an NRI, a POA attested by the Indian Consulate is required.

Common Uses of the PoA Document in Home Loans

The common uses of a power of attorney in a home loan scenario are given below:

• Loan Application: The power granted to a grantee includes the authority to sign and submit the loan application on behalf of the grantor.
• Document Signing: The PoA holder is given the authority to sign the property documents, such as the loan agreements and sale deeds.
• Banking and legal transactions: The agent is authorized to handle all legal transactions and procedures, and can coordinate with banks for EMI payments or disbursements.

Important Points to Consider While Signing a PoA

While applying for a power of attorney for a home loan, there are some important things that you should consider before signing it:

• Trustworthy Agent: The person you are going to appoint as the power of attorney should be someone whom you can trust completely because they are going to have the financial and legal powers. 
• Clear Instructions: Make sure that you clearly mention the extent of powers for the PoA holder to avoid the misuse of the document. 
• Validity Period: You should clearly mention the validity period of the PoA to prevent it from being used forever by the agent.
• Revocation Process: You need to understand the process for revoking the PoA in case there is a need for that in the future.

Explore Visament for the Power of Attorney for the Home Loan

Appointing a PoA can be a blessing, especially for the NRIs, because it is difficult for them to be present at the location every time a new matter arises. You can visit the official website of Visament to draft a Power of Attorney. We have a team of professionals who will assist you in drafting the document to ensure it is legally valid. 

It is essential to attend to all the important details to prevent their misuse. The experts help in a way that can prevent you from being misused. On our website, you can avail many other services too, such as PAN card services, OCI card services, Aadhaar card services, and many others.