Housing Loan can be sanctioned for the construction of new houses, purchase of existing houses, extension, repair, renovation or altering of existing houses. Loans can also be sanctioned for the takeover of existing home loans issued by other Banks. Loans for outright purchase and for extension, repair, renovation or altering, existing residential units not older than 10 years only can be considered. Certificate of age of the residential house to be obtained from approved valuator before sanctioning the loan. Residual age of the residential unit shall be 10 years more than repayment tenure.
The maximum period of loan shall be 20 years for the construction of new house and for outright purchase. In the case of repair, renovation or altering of existing houses, the maximum period is limited to 10 years. The above period is subject to the condition specified in clause 1.2 of this sub rule.
Maximum loan amount for the construction of new houses shall be ₹ 50 lakhs. In case of repair, renovation and extension the maximum amount is ₹ 15 lakhs. The loan amount in all individual cases will be fixed on the basis of the repayment capacity and the source of income of the borrower. Generally, in the case of borrowers of age less than 45 years, the loan amount shall be limited to 50 times the net monthly income subject to a maximum of 50 lakhs. For borrowers above 45 years, loan is limited to 36 times the monthly income subject to the maximum of 50 lakhs.
The loan amount shall not exceed 75% of the estimated cost, in case of construction of new house. In the case of outright purchase the maximum loan amount shall be limited to 80% of the estimated cost of house, landed property, additional amenities, stamp duty and registration fees. For extension, repair, renovation or altering of existing houses the loan amount shall not exceed 75% of the estimated cost. In all the above cases, the valuation shall be done by the empanelled chartered valuator of the Bank. The estimates prepared by approved Engineers shall be certified/countersigned by the chartered valuator.
For construction of new house, the loan amount will be disbursed as five equal instalments. The first instalment will be disbursed on completion of foundation and basement, the second on completion up to belt level including the erecting of doors and windows, third on concreting the roof, the fourth on completion of plastering, fixing of shutters of doors and windows, concreting the floor, and the last installments on completion of the house in all respects, including tiling, plumbing, electrification and whitewashing, as per the plan and estimate. Payment order for very instalment will be released from the Head Office on producing the stage certificate issued by the concerned Branch Manager. The installment amount shall be credited to the borrower’s savings bank account maintained with the Bank. In the case of two storied houses, the total sanctioned amount may be divided as two portion according to the area of the ground floor and first floor and the installments may be disbursed as for the ground floor. A completion certificate of the house should be submitted to the bank on completion of the building along with the copy of the receipt of the house tax. In the case of outright purchase of land and house 100% of the cost as detailed in clause A.4 of this sub rule shall be transferred to the account of the seller kept in our Bank after collecting margin 15% from the loanee. The Branch Manager shall confirm that the total amount as shown in the agreement is declared in the purchase deed and the sufficient stamp paper and registration fees paid. The amount shall be released to the seller only after the execution all agreements and Gahan in favour of the Bank. For extension, repair, renovation or altering of existing houses, installments shall be released according to the progress of work with stage inspection and stage report of the Branch Manager.
Repayment of the loan shall be by way of monthly equated installment method.
The moratorium period is 12 months for construction of new houses and for extension, repair, renovation or altering of existing houses. During the moratorium period, borrower shall remit the interest. In case, there is any interest remaining uncovered in the loan account, the same should be recovered in full before release of subsequent instalment. If house construction is not completed within 12 months, further disbursements will not be allowed and installment will be rescheduled for the amount to be disbursed.