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SBI Home Loan Benefits:
- Assurance of Nationalise Bank
- Lower Interest rates
- Faster door step service
- Low processing charges
- No hidden charges
- No prepayment penalties
- Daily reducing balance
Loan Amount:
Actual loan amount will be determined taking into consideration such factors as applicant’s income and repaying capacity, age, assets and liabilities, cost of the proposed house/flat etc. To enhance loan eligibility you have option to add:
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1) |
Income of your spouse/ your son/ daughter living with you, provided they have a steady income. |
2) |
Expected rent accruals (less taxes, cess, etc.) if the house/ flat being purchased is proposed to be rented out. |
3) |
Depreciation, subject to some conditions. |
4) |
Regular income from all sources. |
Security:
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Primary security is Equitable/Registered Mortgage or Pari Passu/ Second charge over the property. |
Margin/ LTV Ratio:
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Loan Amount |
Margin (Min.) |
Maximum LTV Ratio (Max.) |
Upto Rs. 20 Lacs |
10% |
90% |
Above Rs. 20 Lacs. |
20% |
80% |
*LTV ratio - Loan to value ratio.
Finance Available for
- Cost of land, house / flat
- Additional amenities
- Stamp duty & registration charges
- Service tax and other statutory dues
Repayment Period
- Maximum 25 year or up to the age of 70 year.
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Loan Amount
The home loan amount depends on your repayment capability and is restricted to a maximum of 80% of the cost of the property or the cost of construction as applicable.
Tenure
Maximum tenure of your home loan can be 20 years. However, in case of salaried customers it is capped at retirement age. |
Minimum age: 18 years as on the date of sanction
Maximum age: 70 years. i.e. the age by which the loan should be fully repaid, subject to availability of sufficient, regular and continuous source of income for servicing the loan repayment.
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Q. Can I get an in-principle approval and actually avail of the loan later?
A. What we do is, before you choose the house you want to buy, we give you an in-principle approval based on your income and capacity to repay. This makes the entire process of identifying and buying a house easier and more flexible. You won't be under pressure to identify a house as you know how much funds the bank would make available to you.
Q. And how long is this approval valid?
A. This in-principle approval is valid for 3 months to give you sufficient time to choose a flat/house of your choice.
Q. How long does it take to get my loan sanctioned?
A. Your loan can get sanctioned in a matter of days provided you have all the documents in place.
Q. Can I apply jointly with my spouse? Will both our salaries be taken into consideration for calculating the loan amount?
A. Yes, your salaries can be clubbed for the purpose of calculation of the loan amount. This can be done either when the property is jointly held with the spouse or the spouse stands as a guarantor. Thus, we ensure a great deal of flexibility in the entire exercise of financing your house.
Q. What security do I have to furnish?
A. SBI requires a mortgage of the property for which the loan is being taken. Where mortgage can't be provided, other tangible security would need to be provided. The title of the property should be clear, for which a certificate would be required from the Bank's approved advocate, safeguarding your interests as well as Bank's interests. Additional security may be required where the house is under construction. This may be for an interim period, by way of tangible security or guarantees from sound and solvent individuals.
Q. What are the processing fees charged by the bank?
A. A very nominal processing fee of 0.50% (Max. Rs.10,000/-) is charged by us. Compare this with 1.5-2% charged by the others.
Q. What is EMI?
A. EMI stands for Equated Monthly Installments. This installment comprises both principal and interest components. Use our EMI calculator to find out your monthly payments based on the loan amount, the rate of interest and the repayment period. Choose the combination that best meets your financial resources and requirements.
Q. Can I prepay the loan? Are there any penalties?
A. Yes, you can prepay the loan at any stage. However closure of loan before completion of half of the loan tenure will attract a penalty of 2%. You can also credit more than your EMI amount into your loan account and bring down your interest burden as and when funds are available with you.
Q. Where can I avail SBI Housing loans?
A. We have a network that is unmatched in terms of reach. We have also designated special branches across the country to cater to the housing loan requirements of individual customers.
Q. If I have funds, is it still worthwhile to avail of a bank loan for buying a house?
A. It is generally advantageous to take a Housing loan as it would enable you to get tax exemptions. However, please consult your CA/ income tax advisor to know benefits/disadvantages in your specific case.
Q. What are the tax benefits of taking an SBI Housing Loan?
A. Under the Indian Income Tax Act of 1961, resident Indians are eligible for certain tax benefits on principal and interest components of a loan.
Under Section 24(1), interest repayment of Rs.1,50,000/- per annum qualifies for tax saving under the new Finance Act, provided the property is acquired or constructed with capital borrowed after April 1, 1999 and the acquisition/construction is completed before April 1, 2003 , and the property is self occupied. An added benefit under Section 80(c) on repayment of principal amount to the extent of Rs.1,00,000/- is also available on the same loan subject to compliance with conditions stipulated in the IT Act.
Q. How does SBI housing loan compare with those offered by other institutions?
A. There is total transparency with regard to the rate of interest and the fees charged by us.
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We offer housing loans with the lowest equated monthly installments, i.e. you pay substantially less in repayments as compared to others.
- We have no upper limit. The loan amount is determined by repaying capacity and the value of property to be financed.
- We offer loans for the longest tenors (up to 20 years) with the flexibility provided to reduce the tenor by prepaying the loan without any penalty.
- We provide finance for both new and old houses/flats and for construction of houses. Cost of furnishing the house can also be included in the project cost.
- With an SBI housing loan you can choose between fixed rates of interest and floating interest rates.
- We levy interest based on daily reducing balance, unlike the annual reducing balance method used by several other financiers/banks.
Q. How do I benefit if the interest is calculated on a daily reducing balance?
A. On an annual reducing balance method, you will continue to pay interest on amounts you repay during the coming one year as the interest for the year is determined on the basis of the balance outstanding at the beginning of the year.
In the case of the daily reducing balance, which is the methodology we employ, your interest is calculated only on the outstanding loan amount, which reduces every time you pay off your EMIs or make any prepayments. This in essence lowers your effective rate of interest significantly.
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