Document background
The Home Loan Sanction Letter is a fundamental document in Indonesian real estate financing that serves as the official confirmation of a bank's approval to extend a home loan to a borrower. This document is issued after the bank's thorough assessment of the loan application, property valuation, and the borrower's creditworthiness. It is governed by Indonesian banking regulations, particularly Law No. 10 of 1998 on Banking and various OJK regulations. The letter typically precedes the final loan agreement and outlines all essential terms including loan amount, tenure, interest rates, repayment schedule, and security requirements. It's a crucial document that forms the basis for the subsequent mortgage documentation and property transaction, requiring careful review and acceptance by the borrower before proceeding with the loan disbursement.
