1. What is the minimum loan amount?

You can get a home loan starting from Rs. 2 lakh (Delhi, Mumbai & Bangalore Rs. 3 Lakhs). The loan amount depends on your repayment capability and is restricted to a maximum of 85% of the cost of the property or the cost of construction as applicable. Repayment capacity takes into consideration factors such as income, age, qualifications, number of dependants, spouse's income, assets, liabilities, stability, continuity of occupation and savings history.

2. What are the loan tenure options?

You have the option of selecting a term you are comfortable with, ranging upto 20 years, provided the term does not extend beyond your reaching 65 years of age or retirement age, whichever is earlier.

3. How is the interest charged/calculated?

There are two schemes,
1. Fixed Rate Home Loans
2. Adjustable Rate Home Loans.
If you opt for an Adjustable Rate Home Loan, the interest rate would vary with the Bank Home Floating Reference Rate. Under the Fixed Rate Home Loans the rate applicable on the date of disbursement remains fixed during the entire duration of the loan.

4. How much time will it take for my loan to be approved?

It takes a week for your loan to be sanctioned after you have submitted all the documents.

5.Who can be the co-applicants for the loan?

You could include your spouse as a co-applicant for the loan and we shall include his/her income to enhance your loan amount. Further, in case there are any other co-owners they also need to be co-applicants.

6.Is a personal guarantor a must?

No, there is no personal guarantor required in most cases.


7. What security/collateral do I have to provide?

Typically the security for the loan is a first mortgage of the property to be financed, by way of deposit of title deeds and/or such other collateral security as may be necessary. The title to the property should be clear, marketable and free from any encumbrances.

8. What are the stages involved in taking a loan?

There are two main stages:
1. Sanction of the loan, whereby you get an approval for a specific loan amount based on the value of your property and repayment capabilities.
2. Disbursement of the loan amount.

9. What are the various types of loans available?

1. Home Loans
2. Land Loans
3. Home Equity Loans
4. Office Premises Loans
All of these are available on an adjustable rate or a fixed rate.

10. What is a Monthly Reducing balance?

An Equated Monthly Installment (EMI) has 2 components, interest and principal. When the interest is calculated on monthly rests, the principal on which the interest is charged goes down every month. This results in a significant saving for the customer over the tenure of the loan.


11. What is an Annual Reducing balance?

An Equated Monthly Installment (EMI) has 2 components, interest and principal. When the interest is calculated on annual rests, the principal reduces only at the end of the year. Therefore, you continue to pay interest on a portion of the principal that you have already actually paid back to the lending company..

12. When can I apply for a loan?

You can apply for a home loan even before you have selected your property. The loan amount would be sanctioned or approved for you, based on your repayment capability.

13. When will the loan be disbursed?

Your loan will be disbursed on:
1. Your identification and selection of the property.
2. Submission of the legal documents.
3. Legal and technical clearance of the property
4. Investment of your contribution towards the property

14. What is an amortization schedule?

An amortization schedule is a table giving the reduction of your loan amount by monthly installments. The amortization schedule gives the breakup of every EMI towards repayment interest and outstanding principal of your loan.

15. What are the tax benefits of taking a home loan?

The tax benefits on a home loan, under the Income Tax Act, are two-fold:
1. Principal repaid : Rebate under section 88 (2) of the Income tax Act is available to individuals on repayment of the principal portion as given below

Moreover, the rebate is allowed up to the maximum limit of Rs.20,000 per financial year on the repayment of the principal sums, which need not be out of income chargeable to tax of the year in which such repayment is made.

2. Interest repaid: Under section 24 of the Income Tax Act , in case of self-occupied property, deduction is allowed up to Rs.1,50,000 per annum for houses acquired or constructed with capital borrowed after March 31, 1999 as long as the acquisition or construction is completed within 3 years from the end of the year in which such loan is taken.

16. Can I get IT certificates in the name of both the Applicant and co-Applicant separately?

As per the IT rules only one certificate can be issued for a home loan and hence one certificate will be issued in the name of both applicant and co applicant.

17. When is the IT certificate issued?

The IT certificate will be issued at the end of a financial year. You can expect to receive your copy of the IT certificate in the month of April or May.

18. How can I get the tax benefit during the year?

You can request for a provisional IT certificate that can be issued any time during the course of the year.

Following are some of the most common questions asked by NRIs:

19.Do non-resident Indian citizens/ foreign citizens of Indian origin require permission of Reserve Bank to acquire residential property in India?

Reserve Bank has granted general permission to foreign citizens of Indian origin, whether resident in India or abroad, to purchase immovable property in India for their bona fide residential purpose. They are, therefore, not required to obtain permission of Reserve Bank.

20.In what manner the purchase consideration for the residential immovable property should be paid by foreign citizens of Indian origin under the general permission?

The purchase consideration should be met either out of inward remittances in foreign exchange through normal banking channels or out of funds from NRE/FCNR accounts maintained with banks in India.

21.Are there any formalities required to be completed by foreign citizens of Indian origin for purchasing residential immovable property in India under the general permission?

They are required to file a declaration in form IPI 7 with the Central Office of Reserve Bank at Mumbai within a period of 90 days from the date of purchase of immovable property or final payment of purchase consideration alongwith a certified copy of the document evidencing the transaction and bank certificate regarding the consideration paid.

22.Can such property be sold without the permission of Reserve Bank?

Reserve Bank has granted general permission for sale of such property. However, where the property is purchased by another foreign citizen of Indian origin, funds towards the purchase consideration should either be remitted to India or paid out of balances in NRE/FCNR accounts.

23.Can sale proceeds of such property if and when sold be remitted out of India?

In respect of residential properties purchased on or after 26th May 1993, Reserve Bank considers applications for repatriation of sale proceeds up to the consideration amount remitted in foreign exchange for the acquisition of the property for two such properties. The balance amount of sale proceeds if any or sale proceeds in respect of properties purchased prior to 26th May 1993, will have to be credited to the ordinary non-resident rupee account of the owner of the property.

24.Are any conditions required to be fulfilled if repatriation of sale proceeds is desired?

Applications for repatriation of sale proceeds are considered provided the sale takes place after three years from the date of final purchase deed or from the date of payment of final instalment of consideration amount, whichever is later.