LIST OF DOCUMENTS REQUIRED DURING BOOKING
Resident of India
- Copy of PAN Card – Self Attested
- Residence proof (Driver’s License/Ration Card/Passport/Voters Id/AADHAAR) – Self Attested
- Passport-size photographs (Per Applicant)
- Cheque Book
NRI/Foreign National of Indian Origin/PIO
- Copy of Individual’s passport/Copy of Person of Indian Origin (PIO) card
- 2 Passport-size photographs (Per Applicant)
- All cheque payments should be received from the NRE/NRO/FCNR account of the customer only, or via foreign remittance. Payment from third party accounts will not be acceptable
What is the eligibility criteria for housing loan?
Generally, following conditions must be fulfilled:
- Minimum age of applicant: 21 years
- Salaried or self-employed with regular income
When can I apply for home loan and steps involved in the process?
You can apply for the Home Loan even before you have selected your property or before the start of construction. You will get in -principle approval for the loan amount which will help you decide your budget and plan the purchase of house/flat. There are two stages in the housing loan process
There are two stages in the housing loan process -
- Sanction of the loan
- Disbursement of the loan as per the progress of construction of the property.
Who can be co-applicant for the loan?
- All co-owners need to be co-applicants
- All co-applicants need not be co-owners.
Can I get more than one housing loan?
- Yes. Housing loans can be given to an individual provided he has the capacity to repay. The loans can be for same property (repairs/extension etc) or for different properties.
What are general components of Net Monthly Income to calculate loan eligibility?
The NMI is income from all sources of an salaried individual It Includes:
- The NMI from the salary of applicant
- The NMI from the salary of co-applicant/spouse
- The income from other sources like Rent from the existing/proposed flat, Agricultural income, Income from tuitions, other business etc.
In case of self employed/professional the NMI is Annual Income after deduction of income tax divided by 12 (as per I-T return) plus other income as above.
How much percent of loan can be availed for the purchase of property?
- Upto 80% Loan of Agreement Value only.
What is difference between EMI and Pre-EMI? How is Pre-EMI calculated?
EMI - Equated Monthly Installment. This is the amount paid monthly by a borrower to the bank or any other lender. It basically has two components -
- The portion of the principal amount
- The interest portion for that month
Pre-EMI – Prior to final disbursement of the Housing Loan, you pay interest on the portion of the loan disbursed. This interest is called pre-EMI interest. It is payable monthly/quarterly upto the date of commencement of EMI.
Can the EMI be reset during tenure of loan? Can I make Prepayment towards loan closure?
Yes. If there is substantial revision in the rate of interest, the facility of refixing of EMI can be granted to a housing loan account.
You can pay extra money (more than your EMI) any amount, anytime ahead of repayment schedule to prepay the loan.
Over how many years can I pay the loan?
You can repay the loan over a maximum period of 20 years for both Floating Rate Loans and Fixed Rate Loans. The term will not ordinarily extend beyond your age of retirement (if you are employed) or on reaching 65 years of age whichever is earlier. If the applicant’s age is about the retirement age then he may be required to take a suitable (generally single premium) Life Insurance Policy to cover the risk upto the repayment period of loan. The Bank will help you to determine the repayment period to suit your convenience and financial ability.
What is floating and fix rate housing loan?
Floating Rate - A loan where the interest rate is not fixed is referred to either as a floating interest rate loan, variable interest rate loan or adjustable rate loan, It is linked to a specific index or margin eg. Above/below Medium Term Prime Lending rate (MTPLR)
Fixed Rate - It is a loan where the interest rate is fixed during the life / certain tenure of the loan.
What are the tax benefits available if one avails housing loan?
You will be eligible to claim both the interest and principal components of your repayment during the year.
- Interest can be claimed as a deduction under Section 24. You can claim up to Rs. 150,000 or the actual interest repaid whichever is lower. (You can claim this interest only when you are in possession of the house)
- Principal can be claimed up to the maximum of Rs. 100,000 under Section 80C. This is subject to the maximum level of Rs 100,000 across all 80C investments.
- You will need to show the statement provided by the lender showing the repayment for the year as well as the interest & principal components of the same.
Who Is Non- Resident Indian (NRI) and Person of Indian Origin (PIO)?
An Indian Citizen who stays abroad for employment/carrying on business or vacation outside India or stays abroad under circumstances indicating an intention for an uncertain duration of stay abroad is a non-resident. (Persons posted in U. N. Organizations and officials deputed abroad by Central/state Government and Public Sector undertakings on temporary assignments are also treated as non-residents). Non-resident foreign citizen of Indian Origin are treated on par with non-residential Indian Citizen (NRIs) for the purpose of certain facilities.
A foreign citizen (other than a citizen of Pakistan, Bangladesh, Afghanistan, Bhutan, Sri Lanka or Nepal), is deemed to be of the Indian Origin if he held and Indian Passport at any time, or he or his father or parental grand-father was a citizen of India by virtue of the (Constitution of India or the Citizenship Act, 1955(57 of 1955).
Is permission required from RBI to acquire/purchase immovable property in India?
No. General Permission is available to purchase only a residential/commercial property in India to a person resident outside India who is a citizen of India (NRI) and who is a Person of Indian Origin (PIO).
What is the manner and formalities required towards the payments to be done under general permission guidelines?
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.
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 along with a certified copy of the document evidencing the transactions and bank certificate regarding the consideration paid.
Can such property be sold without permission of Reserve Bank?
Yes, Reserve Bank has granted general permission for sale of such property. However whether 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 balance in NRE / FCNR accounts.
Can sale proceeds of such property be remitted out of India?
With respect to 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.
What is the procedure for seeking repatriation and conditions required towards the sale proceeds?
Applications for necessary permission for remittance of sale proceeds should be made inform IPI 8 to the Central Office of Reserve Bank at Mumbai within 90 days of the sale of the property. Applications for repatriation of sale proceeds are considered provided the sale takes place after three years from the date of final purchase deed from the date of payment of final installment of consideration amount, whichever is later.
Can foreign citizen of Indian Origin acquire or dispose of such property by way of gift to relatives/registered charitable trust/ organizations in India or abroad?
Yes. Reserve Bank has granted general permission to foreign citizen of Indian Origin to acquire or dispose of properties up to two houses by way of gift from or to a relative who may be an Indian Citizen or a person of Indian origin whether resident in India or not, subject to compliance with applicable tax laws.
Can the properties be given on rent if not required for immediate use?
Yes. Reserve Bank has granted general permission for letting out any immovable property in India. The rental income or proceeds of any investment of such income are eligible for repatriation.
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Which documents are to checked and verified before purchase of a property?
Before you purchase a flat, you have to look at the approved layout and building plan, title search conducted by a competent advocate, ownership documents, Environmental clearance, Intimation of Disapproval, Commencement certificate etc. You may contact an advocate before purchasing a property to get detail advice.may contact an advocate before purchasing a property to get detail advice.
What the difference between built up, super built up and carpet area?
- Carpet area: An area of an apartment which doesn’t include the area of the walls.
- Built up area: This includes area of the wall also.
- Super Built up area: This includes the built up area along with common spaces such as lobby, lifts, stairs etc. This term is applicable to multi dwelling units
Who is liable to pay stamp duty and in whose name are the stamps required to be purchased?
The liability of paying Stamp Duty is that of the buyer unless there is an agreement to the contrary. Section 30, of the Bombay Stamp Act, 1958 states the liability for payment of Stamp Duty.
The Stamps are required to be purchased in the name of any one of the executors to the instrument.
What is meant by the market value of property and is stamp duty payable on the market value or on consideration as stated in the agreement?
- Market value means the price at which a property could be bought in the open market on the date of execution of such instrument. The Stamp Duty is payable on the agreement value of the property or the market value whichever is higher.
Can one obtain refund if the agreement has not been signed between both the parties & have paid the stamp duty?
- When one person possessing stamp or stamps which have been spoiled or rendered unfit or useless for the parties intended or the person does not require immediate use of the said stamps then such person should deliver the above said stamps to the Collector. The person has to make an application under Sec. 52 of the Bombay Stamp Act and the person should also submit the affidavit mentioning the reasons for which the stamps had been purchased and the reasons why the refund application is being made.
- If the applicant can convince the Collector then refund of the stamps could be obtained only if: The application is made within six months from the date of the purchase of stamps. The Stamps should have been purchased by such person with a bonafide intention. None of the parties should have signed the paper on which the stamps have been fixed. On receipt of such application, the Collector is empowered to refund to the said person the value of said stamp deducing there from said amount as prescribed by the competent authorities.
Will stamp duty have to be paid if a flat is settled through a deed & transferred amongst family members?
- Yes, as per the provisions of Bombay Stamp Act, Stamp Duty will have to be paid on a deed of Family Settlement.
What are the instruments that attract the payment of stamp duty?
The instruments like Agreement to sell, Conveyance Deed, Exchange of Property, Gift Deed, Partition Deed, and Power of Attorney, Settlement and Deed and Transfer of Lease attract Stamp Duty on market value of the property.
Who is the appropriate authority for knowing the market value of property?
The Sub-Registrar of the area in whose jurisdiction the property is located is the appropriate authority for knowing the market value of the property.
Can a property transaction be done by someone on owner’s behalf?
- Yes. Though Power Of Attorney subject to eligibility of POA holder and POA content.
- For all practical purposes, you can give a specific power of attorney to someone, so that in your absence, things like registration, possession, execution of agreement for sale, agreement of leave and license etc, can be taken care. You can give a very specific POA to someone e.g. only for buying, or leasing, etc. you could fine tune the rights you would like to give out and clear that up
What is meant by free hold land?
A freehold property (plot or a flat) is one where there is a whole and sole owner(s) ownership is full and unconditional (within the provisions of the laws of the land) and there is not lessor / lessee involved.