Know your EMI before you fall in love with the flat.

A home loan is money borrowed against the property you are buying. The bank pays a share of the purchase price, you pay the rest as a down payment, and the property is held as security until the loan closes. You repay in equated monthly instalments (EMIs) that cover both interest and principal — early instalments are mostly interest, later ones mostly principal. If the loan is not repaid, the bank can enforce its charge over the property.

Banks in Bangladesh typically lend for buying a ready apartment, buying an under-construction unit from a developer, constructing a house on land you already own, renovating or extending an existing home, and taking over an existing loan from another bank at a better rate (a takeover or balance transfer). Some banks also lend against a property you already own. Terms, maximum amounts and tenures differ meaningfully between these, so ask for the product that matches your situation rather than the generic one.

Banks look at four things: stable, documentable income; your age, since the loan usually has to finish before you retire; your repayment record, which they check through the Credit Information Bureau at Bangladesh Bank; and the property's legal papers. They also cap how much of your monthly income can go to loan repayments once all your existing EMIs are added in, so an outstanding car or personal loan directly reduces what you can borrow. Salaried applicants, business owners and non-resident Bangladeshis are usually assessed under different criteria.

Roughly: you ask a few banks for an indicative offer, pick one and submit the full application with your income and identity documents; the bank verifies your income and pulls your credit report; it has the property valued and its title checked by its own lawyer; it issues a sanction letter with the amount, rate and tenure; you accept, sign the mortgage documents and pay the processing fee; the bank disburses to the seller or developer. Expect a few weeks, and expect the property's paperwork — not yours — to be the slow part.

For you: National ID, TIN certificate, recent photographs, and proof of income — salary certificate and payslips if you are employed, or trade licence, audited accounts and business bank statements if you are not. Plus at least six to twelve months of bank statements. For the property: the deed, the mutation and up-to-date khatian, rent receipts (dakhila), the approved building plan and the developer's or seller's own chain of title. If you are buying from a developer, you will also need the allotment letter and the deed of agreement.

A great deal, because it compounds over a very long period. Two things to watch beyond the headline number. First, most home loans here are floating — the rate is reset periodically by the bank, so the EMI you sign up for is not fixed for twenty years. Second, tenure and rate pull in opposite directions: a longer tenure makes the monthly payment comfortable but can add years of extra interest to the total. The calculator above shows both figures at once for exactly this reason. Also ask about processing fees, early settlement charges and whether partial prepayment is allowed, since those change the real cost.

Bangladesh Bank has at various times run refinance schemes for housing, and there are state-backed housing lenders alongside the commercial banks. What is available, who qualifies and at what rate changes with policy, so treat any figure you read online as possibly out of date and confirm the current scheme with the bank or the lender directly before you count on it.

Most problems are documentary rather than financial: incomplete or disputed title, a mutation that was never done, unapproved construction or deviation from the sanctioned plan, or a developer who cannot produce a clean chain of ownership. On the borrower side, the common ones are underestimating the cash needed at closing — registration costs, stamp duty, processing fees and the down payment all land at once — and stretching the EMI so far that a rate reset becomes painful. Leave headroom in the monthly figure for both.

Compare the total you repay, not the advertised rate. Ask each bank for the effective rate including processing fees, how often the rate is reset and against what, the penalty for early settlement, whether partial prepayment is free, and how long disbursement takes. Then ask for a written sanction from more than one — a competing offer is the only real leverage you have. Speed and responsiveness matter too, particularly if you are on a deadline with a seller.