Q: What is a home loan?
A: A home loan is a loan provided to purchase, construct, or renovate a residential property.
1. How will the Bank decide the home loan amount I am eligible for?
Bank will determine your Home Loan Eligibility largely by your income and repayment capacity. Other important factors include your age, qualification, number of dependents, your spouse's income (if any), assets & liabilities, savings history, and the stability & continuity of occupation.
2. What does an EMI mean?
EMI refers to the 'Equated Monthly Installment' which is the amount you will pay to us on a specific date each month till the loan is repaid in full. The EMI comprises of the principal and interest components which are structured in a way that in the initial years of your loan, the interest component is much larger than the principal component, while towards the latter half of the loan, the principal component is much larger.
3. How do I repay a home loan?
For your convenience, the Bank offers various modes for repayment of your house loan. You may issue standing instructions to your banker to pay the installments through ECS (Electronic Clearing System), opt for direct deduction of monthly installments by your employer, or issue post-dated cheques from your salary account.
4. What does the 'market value' of the property mean?
Market value refers to the estimated amount that is expected to be fetched on the property as per the prevailing market conditions.
5. Do I get tax benefits on the loan?
Yes. You are eligible for tax benefits on the principal and interest components of your Home Loan under the Income Tax Act, of 1961.
6. When do I start repaying the principal amount?
Repayment of the principal commences from the month following the month in which you avail full disbursement of your loan. Pending final disbursement, you pay interest on the portion of the loan disbursed. This interest is called pre-EMI interest. Pre-EMI interest is payable every month from the date of each disbursement up to the date of commencement of EMI.
7. When can I take disbursement of the loan?
You can take disbursement of the loan once the property has been technically appraised, all legal documentation has been completed and you have invested your Own Contribution in full. Then we will disburse the loan.
8. Are there any restrictions on the transfer of immovable properties?
There will be no restriction on the transfer of immovable property but the transfer can take place only after a no-dues certificate from the Lender.
9. How is the Home Loan EMI Calculated?
The Home Loan EMI amount is dependent on three key aspects Home Loan Principal Amount, Home Loan Interest Rate, and Home Loan Repayment Tenor. You can also use the EMI Calculator to calculate your EMI amount before you apply for a Home Loan.
10. Can I repay my Home Loan ahead of schedule?
Yes, Lenders allow individuals with Home Loans to repay ahead of schedule without any additional fees. Here are the two ways in which one can consider doing so: Part-prepayment and Foreclosure.
11. Can my spouse and I Jointly apply for a Home Loan?
Yes, both you and your spouse can be joint applicants on your Home Loan. There are several benefits of applying for a joint Home Loan, some of which are Increased Home Loan eligibility, Increased Income Tax savings and Increased Ease of Home Loan Repayment.
12. What is a Top-up Loan?
The Top-up Loan is a refinancing option commonly available to Home Loan Balance Transfer applicants who meet the eligibility criteria. When the borrower avails of the balance transfer facility, they can also avail of additional funds for expenses such as home renovation.