Home Loan FAQs - Frequently Asked Question - Part - 3

Q1.  Are NRI/PIO/OCI eligible for Housing loans to buy property from any Indian Bank? 

Ans: An authorised dealer or a housing finance institution in India approved by the National Housing Bank may provide housing loan to a non-resident Indian or a person of Indian origin residing outside India. A maximum of 80 per cent amount is financed by the financial institution. The rest has to be given by the NRI.

For acquiring a residential property in India, the buyer is subject to the following conditions, namely:

a) The quantum of loans, margin money and the period of repayment shall be at par with those applicable to housing finance provided to a person residing in India.

b) The loan amount shall not be credited to Non-resident External (NRE)/Foreign Currency Non-resident (FCNR)/Non-resident non-repatriable (NRNR) account of the borrower.

c) The loan shall be fully secured by an equitable mortgage by deposit of title deal for the property  proposed to be acquired, and if necessary, also be lien on the borrower’s other assets in India.

d) The instalment of loan, interest and other charges, if any, shall be paid by the borrower by remittances from outside India through normal banking channels or out of funds in his Non-resident External (NRE)/Foreign Currency Non-resident (FCNR)/Non-resident Non-repatriable (NRNR)/Non-resident Ordinary (NRO)/non-resident Special Rupee (NRSR) account in India, or out of rental income derived from renting out the property acquired by utilization of the loan or by any relative of the borrower in India by crediting the borrower’s loan account through the bank account of such relative (The word ‘relative’ means ‘relative’ as defined in section 6 of the Companies Act, 1956.)

e) The rate of interest on the loan shall conform to the directives issued by the Reserve Bank of India or, as the case may be, the National Housing Bank.

Q2.  Which documents are required to buy a property in India?

Ans: The following documents are required for buying a property in India:

a) Pan card (Permanent account number)

b) OCI/PIO card (In case of OCI/PIO)

c) Passport (In case of NRI)

d) Passport size photographs

e) Address proof

Q3.  Which documents are required for a home loan?

Ans: For salaried individuals, the following documents are required:

a) Copy of employment contract

b) Latest Salary slip

c) Latest work permit

d) Bank statement for 4 months or NRE/NRO a/c 6 months statement

e) Passport/visa copy

f) Utility bill for address proof

g) PIO/OCI card

h) Power of Attorney (if applicable, in respective bank’s format)

i) Customer credit check report

j) Property agreement duly registered or other related docs

k) Income Tax returns last 2 years

For self-employed, the following documents are required.

a) Balance sheets and P&L a/c of the company for last 3 years

b) Bank a/c statements for the last 6 months for company and individual, both

c) Income tax returns (3 years)

d) Passport/visa copy

e) Utility bill for address proof

f) PIO/OCI card

g) Power of Attorney (if applicable, in respective bank’s format)

h) Credit check report

i) Property agreement or other related docs


Read Other: Legal NRI FAQ's, Tax NRI FAQ's.
                    
About the Author: Naveen Kr. Jain, VP, Head of Operations & Customer Services, IndiaHomes Property Group, is an MBA & LLB with 16 years of experience in operations and customer services. At IndiaHomes.com, he is responsible to ensure that all processes, policies and practices followed by the organisation are customer centric and should result in an optimal solution for the end user. Naveen has held senior leadership roles in ING Vysya Bank, HDFC Bank & Stock Holding Corporation of India. Being a certified six sigma black belt & ISO 9001: 2008 lead auditor, the implementation of quality management systems and standards for operational excellence have been Naveen’s key strengths and areas of focus.