Loans are provided by banks and NBFCs to individuals or self-employed individuals for purchasing eligible residential properties, either from builders or through resale from previous owners. Both under-construction and fully constructed properties are eligible for such loans.
Key considerations for home buyers after selecting a property include: the payment terms and conditions set by the seller, the agreement value, availability of margin money, availability of a cost sheet (in case of purchase from a builder), and availability of necessary documents such as approved plans and occupancy certificates. It’s crucial to finalize these aspects before applying for a home loan from financial institutions.
Most banks and NBFCs offer home loans with Loan to Value (LTV) ratios typically ranging from 75% to 90% of the property’s cost, depending on the loan amount and their specific lending criteria.
The residential property being purchased must be in the seller’s name and legally clear according to local laws. It should also be marketable and free of any unauthorized structural alterations. Additionally, the property must be located in areas approved by different lenders based on their respective norms.
The maximum loan tenure available is up to 30 years, subject to the applicants’ age at the loan’s maturity or the lender’s criteria. The property’s market value is usually determined by valuers approved by the respective lenders.
For income eligibility calculations, both the borrower and co-applicants’ incomes can be combined. Lenders vary in their selection of eligible co-applicants, but typically include blood relatives and spouses as natural choices.