HOME LOAN
Home loan is an easy way to buy your own much-awaited DREAM HOME.
Availing Finance from Financial Institutions to own residential property is called Home Loan. These Home loans can vary from INR 5 lac to INR 50 cr. It can be for a short term period of 2-3 years to 30 years – depending upon the specific requirements of the Customers.
Home Loan facility is sanctioned in accordance with White Value or Agreement value or Circle Rate of Property, i.e. on the price on which stamp duty is paid and the registry is done. Another major factor that decides the Loan amount is the current Market Value of the property.
Usually, Banks are comfortable extending up to 75% – 80% of the Cost of White value/Agreement Value of the property But Subject to Maximum 75% or 80% of Market Value of property( Whichever is Lower).
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Who can avail this loan?
Home Loan Eligibility calculation is complex process with different banks having different criteria and parameters. But broadly following parameters decide on Home loan Eligibility
- Monthly income of the Customer
- Monthly obligation of the Customer
- Category of Customer – Salaried, Self-Employed or Professional
- Profile of Customer – Higher Risk profile constitutes Low eligibility
- White Value or Agreement Value or Registry Value of property
- Market Value of property
- Tenure of loan
- Interest rates of Loan
FAQs
A home loan can be availed for buying a New House, Home Renovation, Home Construction, Buy a Plot or Balance transfer of existing Home Loan.
Yes. All the co – owners of your property will have to sign up as co-applicants. For a sole property owner or applicant also, most banks require one adult member in the family to sign up as a co-applicant. In case of partnership firm or a company, partners and promoter directors respectively need to be co-applicants.
- Salaried Individuals,
- Self Employed Professionals i.e Chartered Accountants, Doctors, Architects, Cost Accountants, Company Secretary, Management Consultants etc.
- Self Employed Non Professional i.e Traders, Distributors, Manufacturers, Service Providers etc.
- Non-Individual Entities i.e. Proprietorship Firms, Partnership Firms, Private Limited Companies, Public Limited companies.
Your bank will assess your repayment capacity while deciding the home loan eligibility. Repayment capacity is based on your monthly disposable income, which basically means how much of your monthly income you can spend for repaying the loan after deducting monthly expenses and obligations. The higher the monthly disposable income, higher will be the amount you will be eligible for loan.
EMI stands for Equated Monthly Instalment. You repay the loan in EMIs, which comprising both principal and interest. Click here for EMI calculator.