Home Loans

Eligibility will subject to the repayment capacity as determined by the bank. It takes into consideration factors such as income, age, qualifications, number of dependents, spouse’s income, assets, liabilities, stability and continuity of occupation and savings history. And, of course, the bank’s main concern is to make sure that the borrower can comfortably repay the amount.

At any time after the applicant has decided to acquire/construct a property, even if the property has not been selected or the construction has not commenced.

To start with collect the application form from any of the respective bank’s offices or download one from their website and submit it along with supporting documents at any nearest office. On receipt of the completed application form with the processing fees, the bank will consider the application, make enquiries as it deem necessary and convey its decision.

Many banks also offer the option of applying for a housing loan online, by just logging onto their official website. After it is approved, walk in to the selected bank office for submission of documents and further processing.

Can an applicant apply for a loan to repay a housing loan availed from another bank / housing finance company?

Yes, the applicant can avail bank’s home loan to repay a loan availed from employer or another bank / housing finance Company.

What are the fees and charges payable and when are they payable?

• Allotment letter of the co-operative society / association of apartment owners
• Copy of approved drawings of proposed construction purchase / extension
• Agreement of sale / sale deed / detailed cost estimate from architect / engineer for the property to be purchased / constructed / extended / renovated
• If an applicant is in the present employment / business or profession for less than a year, then in a separate sheet details of occupation for previous 5 years, position held, reasons for change and period of the same has to be written in detail
• Applicable Processing Fees

Proof of Residence: Attested copy of any one of the following:

• Ration Card
• Passport
• Bank Account Statement
• Voters Identity Card
• Current Telephone / Electric Bill
• Letter from recognized public authority
• Letter from Employer (subject to the satisfaction of the bank)

Many banks offer loans to buy or construct a home, refinance a home loan availed from other institutions and also to extend existing home.

Proof of Identity: Attested copy of any one of the following:

• Passport
• Driving License
• Voters Identity Card

Identity Card issued by Employer (if employed in State/Central Govt.)

• PAN Card
• Letter from Employer (subject to the satisfaction of the bank)
• Certificate of loan outstanding issued by the lender (for refinance cases only)
• Any other information regarding repayment capacity that is necessary and will assist the bank in appraising the loan proposal

• Verification of Employment Form with only Part I filled in
• Latest original salary slip salary certificate showing all deductions.
• If applicant job is transferable, permanent address where correspondence relating to [he application can be mailed
• A letter from applicant’s employer agreeing to deduct the EMI towards repayment of the loan from salary. This will expedite processing of the loan application
• Updated original Bank Pass Book’s or Original Bank Statement’s showing salary and savings entries for the last six months
• A photo-copy of applicant’s Form-16 (issued by applicants employer) for the last Assessment Year
• Verification of Employment Form with only Part I filled in
• Latest original salary slip salary certificate showing all deductions.
• If applicant job is transferable, permanent address where correspondence relating to [he application can be mailed
• A letter from applicant’s employer agreeing to deduct the EMI towards repayment of the loan from salary. This will expedite processing of the loan application
• Updated original Bank Pass Book’s or Original Bank Statement’s showing salary and savings entries for the last six months
• A photo-copy of applicant’s Form-16 (issued by applicants employer) for the last Assessment Year

• Balance Sheets and Profit & Loss Accounts of the business/ profession along with copies of Individual Income Tax Returns for the last three years certified by a Chartered Accountant
• A note giving information on the nature of applicants business / profession, form of organisation, clients, suppliers, etc.
• Copies of Individual Tax Challans for the last three years
• Copy of Advance Tax Challan (if any)
• Updated original Bank Pass Book’s or Original Bank Statement’s showing savings entries for the last 12 months
• Balance Sheets and Profit & Loss Accounts of the business/ profession along with copies of Individual Income Tax Returns for the last three years certified by a Chartered Accountant
• A note giving information on the nature of applicants business / profession, form of organisation, clients, suppliers, etc.
• Copies of Individual Tax Challans for the last three years
• Copy of Advance Tax Challan (if any)
• Updated original Bank Pass Book’s or Original Bank Statement’s showing savings entries for the last 12 months

NRIs (Non Resident Indians) are expected to provide the following documents

• Latest 6 months pay slips (Original)
• Latest 6 months bank statement reflecting salary credits. (Oversees account) (Original)
• Appointment order copy & employment contract copy, Passport & visa copies, Green card copy (If possessed)
• Personal Bio data – A summary of applicants past employment /customer detail sheet
• NRE & NRO A/C statements for last 6 months(Please note all the payments to the bank should be through NRE or NRO a/c cheque only)
• Power of attorney (To be compiled in the bank format in addition to the General power of attorney)
• Address proof of residence ( Passport, Telephone bill, Bank statements can be given for this requirement)
• Details of any loans availed.
• Loan processing fees Rs:11030/- including service tax in favour of the name of the bank
• 0.5% or Rs 25000/- (whichever is less ) of the loan amount n.j. stamp paper in favour of applicants name
• Resi-Rental detail in overseas.
• Applicants Money transfer to India, A/c statement 6 months
• P.O.A address proof and photo& id proof
• W2O form / income tax details & Credit bureau report (not applicable if applicant is in Arabic countries)
• Applicant & co applicant Photo to be affixed with sign in the application form
• Documents required for both applicant & co applicant
• Documents submitted for the ID and Address proof has to be either Notarized or the originals has to be verified by the bank

Proposed owners of the property, in respect of which the applicant is seeking financial assistance, will have to be co-applicants. However, all co-applicants need not be co-owners.

Applicant can repay the loan over a maximum period of 20 years under both the FRHL and the ARHL. Repayment will not ordinarily extend beyond the applicant’s age of retirement (if applicant is employed) or the applicant is reaching 65 years of age, whichever is earlier. However, the bank will endeavour to determine the repayment period to suit the applicant’s convenience.

Repaying the loan in EMls comprises of principal amount and rate of interest. Repayment by way of EMI commences from the month following the month in which the applicant avails full disbursement. In case of pending final disbursement, the applicant pays interest on the portion of the loan disbursed. This interest is called pre-EMI Interest. Pre-EMI interest is payable every month from the date of each disbursement up to the date of commencement of EMI.

The banks also offer the applicants a unique ‘Tranching’ facility for repayment of loan. Instead of paying Pre-EMI on the amounts disbursed, applicant can choose to pay an interim EMI of an amount convenient and thus commence repayment of principal even before the loan is fully disbursed. This would be useful in case when disbursements are likely to be spread over a longer period of time. *Conditions apply

Many banks offer various flexible repayment options like Step Up Repayment Facility (SURF), Flexible Loan Installment Plan (FLIP), Balloon Payment Plan (BPP) and Structured Repayment Plan (SRP). These flexible repayment options give applicants the freedom to structure the repayment schedule to suit their individual needs.

Security for the loan normally is first mortgage of the property to be financed and / or such other collateral security as may be necessary. Interim security may be required, if the property is under construction.

Collateral or interim security could be assignment to the bank’s life insurance policies, the surrender value of which is at least equal to the loan amount, guarantees from sound and solvent guarantors, pledge of shares and such other investments that are acceptable to the bank. Loans from the banks are available even if the applicant avails a housing loan from the employer. The respective bank has already entered into arrangements with several employers enabling employees to avail of loans both from the employer as well as the bank for the same property.

Please do ensure that the title to the property is clear, marketable and free from encumbrance. To elaborate, there should not be any existing mortgage, loan or litigation which is likely to affect the title to the property adversely.

Applicant can take disbursement of the loan after the property has been technically appraised; all legal documentation has been completed and has invested applicant’s own contribution in full. Own contribution is the total cost of the property less bank’s loan.

The loan will be disbursed in full or in suitable installments (normally not exceeding three in number) taking into account the requirement of funds and progress of construction, as assessed by the bank and not necessarily according to a builder’s agreement.

Applicant is advised to enter into such agreements with builders whereby payment is dependant upon the progress of work and not on a time-based schedule.

Yes, applicant can repay the loan ahead of schedule by making part or full prepayment. Many of the banks also offer a facility to accelerate the repayment of the loan by increasing the EMI at anytime, which will help applicant to repay the loan faster. This acceleration facility is available free of charge.

In many states in India, the agreement for Sale between the builder / seller and purchaser is required by law to be registered. Applicant is advised to lodge the Agreement for registration within four months of the date of the Agreement at the office of the Sub-Registrar appointed by the State Government, under the Indian Registration Act, 1908.

Applicant has to ensure that the properly is duly and properly insured for fire and other appropriate hazards during the pendency of the loan and to produce evidence thereof to the bank, each year and/or whenever called upon to do so. The bank should be the beneficiary of the insurance policy.