Can an NRI apply for a Housing Loan to buy a property in India?
Yes, an NRI can avail a housing loan in India.
Is there a pre-requisite as an NRI to apply for a housing Loan in India?
Only graduate NRIs can avail home loans in India.
What are the properties as an NRI can one apply for to avail a housing loan?
Home loans can be availed for any of the following:
Ready to occupy or under construction properties
Construction of a property on an owned plot
Refurbishing an existing property
What are the Documents required for an NRI to apply for Housing loan?
One should have copies of valid passport, salary certificate and statements of non-resident external (NRE) or non-resident ordinary (NRO) accounts, work experience certificate, bank account statement / passbook for the last six months and a valid job contract or work permit.
An individual should be employed abroad for a minimum period of two years. Proof of income is required in case of self-employed professionals.
The salary certificate should be attested from the embassy if the salary is not credited in to a bank. A local address proof in India and a power of attorney (PoA) and details of permanent address in India is mandatory.
Can we apply for a housing loan without appointing a POA holder ?
If you could travel here for all documentation and verification process then there is no need for a POA holder. To make things easy it is recommended to have a local POA to address any registration queries that may arise.
What is the procedure to appoint Power of Attorney to buy a property in India?
In case you are not physically present in India, then you can appoint anyone residing in India as your representative. Make sure the POA is drafted in a stamp paper and duly registered in a regional sub registrar office in your locality.
If you are not physically available in India write the POA terms in a plain sheet of paper and get it attested by your local Consulate of India. Then the sheet needs to be sent to your representative in India, then he/she should get it registered in the Sub Registrar office.
What is the upper limit on the amount of housing loan for an NRI?
Income and educational qualifications play an important role in deciding the upper limit of the loan to an NRI. Banks allow an advance of 80-85% of the value of the property, subject to one's gross monthly incomecome (GMI). Upper limit is usually around 50 times of one's GMI.
What is the tenure of repayment?
Tenure of repayment for NRI home loans is restricted. It is available within the range of 5-15 years. Extension beyond the term of 15 years is solely at the discretion of the bank and in exceptional cases only. The tenure also depends on factors such as income, age, qualifications, number of dependents, spouse's income, credit history, assets, liabilities, stability and continuity of occupation and savings history.
Is there any variance in rate of interest or processing charges for an NRI applicant?
No, NRIs also have the same rate of interest and same processing charges as a resident of India.
In what manner will the sanctioned loan amount get disbursed for a NRI applicant?
The cheque for the loan amount is drawn in favour of the developer or the seller (resale property) as the case may be. In case of an under-construction projetct, the bank disburses the loan amount proportionate to the stage of construction.
What is the repayment process for an NRI housing loan?
The repayment or the EMI of this loan should be through an NRE or NRO account with remittance from another country. The repayment can be made in Indian rupees only. The down payment should also be done through normal banking channels or an NRE or NRO account in India.
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