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1. Who can apply for a Home Loan? |
Ans : Home Loan are for those going in for a residential house. You may apply for it after you have decided to acquire/construct a property, and even in case, the property has not been selected or the construction has not commenced, you can still apply. You can also avail for Home Loan facility if you want to renovate or expand your home. |
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| 2. How is my Home Loan eligibility determined? |
Ans : Loan amount eligibility is determined on the basis of the repayment capacity of the applicant. The various factors are taken into consideration, for such as: |
- Age
- Income
- Assets/Liabilities
- Qualifications
- Spouse's income
- No. of dependants
- Stability and continuity of occupation
- Savings history.
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| 3. What is the maximum amount I can borrow? |
Ans : The maximum amount that you can borrow depends on factors such as:
- The purpose of the loan.
- Whether it is for purchase of property or improvement or renovation.
- Or purchase of land for development etc.
Besides, your residential status (whether resident Indian or Non-Resident Indian) will also be significant on the maximum quantum of loan that you can borrow. Typically Home Loans are provided for in the range of 70-85 % of the cost of the property, including cost of land.
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| 4. Is it worthwhile to avail a bank loan for buying a house, even though I have funds? |
Ans : It is generally advantageous to take a Housing loan as it would enable you to get tax exem ptions. However, please consult your CA/ income tax advisor to know advantage/disadvantages in your specific case. |
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| 5. How long does it take to get my application processed and the loan sanctioned? |
Ans : It takes around one week for approving the facility of one's application if all the necessary documents are in order and takes another week for the bank to inspect the property papers and make the disbursement. |
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| 6. Do I need to insure my property before applying for a Home Loan? |
Ans : Yes, insurance of the property against fire, flood, riots, earthquakes and other appropriate hazards is necessary during the tenor of the loan. |
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| 7. Can my spouse’s salaries be taken into consideration for calculating the loan amount? |
Ans : Yes, your salaries can be clubbed with your spouse for 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 Co-applicant. |
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| 8. Can I take a Home Loan for construction in one city while working in another city? |
Ans : Yes, you can take loan for construction in one city while working in another. The banks usually service this loan after getting details of the plot legally verified. |
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9. What is the range of interest rates offered? |
Ans : The interest rate varies from banks to banks/HFCs and normally ranges from 10 % to 15%. |
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Ans : 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 to meet your financial resources and requirements. |
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| 11. What are the bases of interest rates calculation? |
Ans : The interest rate on Home Loans is usually calculated on Monthly Reducing or Yearly Reducing balance. In Monthly Reducing Balance, the principal on which you pay interest reduces every month as you pay your EMI. However in Yearly Reducing Balance, the principal is reduced at the end of the year, therefore you continue to pay interest on a certain part of the principal which you have actually paid back to the bank, which basically means the EMI for the Monthly Reducing system is effectively lesser than the Yearly Reducing system of calculating the interest. |
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| 12. What is the Fixed Rate of Interest and Floating Rate of Interest? |
Ans : Fixed Rate of Interest means that the interest rates remain FIXED for the entire duration the loan or for a specific period. This basically means that you do not benefit, even if the rates of interest drop in the market at the same time you are protected in case if there is an up-side movement in the interest rate. And Floating Rate of Interest is the rate of interest that fluctuates according to the market lending rate. |
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| 13. Can I repay my loan ahead of schedule? |
Ans : Yes, you can pay your loan ahead of schedule. However, it must be noted that some banks charge a fee for early redemption of loan. This fee can vary between 1-2% of the loan amount being pre-paid. |
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| 14. Who can be a Co-Applicant? |
Ans : The Co-owners of the property in respect of which financial assistance is sought, must be co-applicants. Usually joint applications are from husband-wife, father-son, brother-brother, brother-sister or mother-son. |
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| 15. How can I repay the loan? |
Ans : You can repay your Loan by the mode of Equated Monthly Installments (EMI) i.e. a uniform lump sum amount, which includes repayment of a part of the principal amount and payment of interest, calculated on monthly rent basis. EMI is 1/12 of the annual installment. It remains uniform throughout the term of the loan. By the end of the term the loan will be fully repaid. Till the loan is fully paid or until 12 months from the date of first disbursement whichever is earlier, only interest is payable on the loan disbursed. |
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| 16. What Tax benefits do I get on my Loan? |
Ans :Rebate under Sec 88 of IT Act for repayment of Principal Amount up to a Maximum of Rs.20,000/- Rebate of 20% of Principal Amount ( i.e. Maximum Rebate of Rs. 4000/- ).
Yes, you are eligible for tax benefits on the principal and interest components of the loan under the Income Tax Act, 1961. However as the benefits could vary each year, do check out the current benefits available. |
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| Personal Loan |
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| 1. What can I use a Personal Loan for? |
Ans : Personal Loans can be used for anything and everything. You could use the loan money to finance anything from the latest flat-screen-plasma-LCD TV to buying your better-half a diamond ring, children's school admission, daughter's wedding, paying off another loan or for an international vacation, whatever the need and urgency be. |
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2. How do I take a Personal Loan? |
Ans : You just need to log on to our Portal myloan24x7.com and feed in some information and we will take care of the rest. |
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3. How is my loan eligibility determined? |
Ans : Loan eligibility depends upon various factors which differ from banks to banks. The main factor of course, is your ability to repay the loan. Also your profile, in terms of residence and the place you work in also matters. |
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| 4. What are the loan tenure options? |
| Ans : The loan can be repaid over a period of 12 to 60 months. |
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| 5. How much personal loan can I get? |
Ans : The minimum loan amount is Rs. 50,000 and the maximum loan amount could be up to Rs. 15, 00,000 based on the Bank's qualifying criteria. |
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| 6. What are the fees and charges payable and when are they payable? |
Ans : Apart from the rate of interest bank also do charge some fees which are of usually two types. Once when you are applying for the loan and once when you are preclosing the loan. The fees when charged at the time of processing called as Processing Fees vary from 1-2% of the loan amount. The second charge is the prepayment penalty paid at the time of preclosure. This too varies from 1 –5 %. |
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| 7. What is the rate of interest that will be charged on my loan? |
Ans : The interest rate varies from bank to bank. And usually it varies from 14%-26% depending upon your profile and the policies/scheme you opt for. |
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| 8. How much time does it take to get the Loan disbursed? |
Ans : Usually banks disburse the loan within seven working days once you submit all the required documents. |
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| 9. Can I apply for loan, jointly with my spouse? |
Ans : Generally the clubbing of Income is prohibited. But there are certain which accept clubbing if applied jointly with a co-applicant (either be your spouse or your parents). |
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| 10. Do I have to provide any security, collateral or guarantors? |
| Ans : No security, collateral or guarantors are required for obtaining a Personal Loan. |
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| 11. How do I repay my loan? |
Ans : You can repay the loan over a period of 12-60 months in case if you are salaried or 12-36 months incase of you are a Self Employed Professional/Self Employed Businessman. Equated Monthly Installments (EMIs) can be paid either by post dated cheques, or through ECS facility provided by some banks. |
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Car loan |
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| 1. How much loan can I get? |
Ans : Different banks have different terms for different models (standard/premium, new/old). The percentage of finance the banks give on cars is also determined on the basis of second-hand market value of that particular car. The amount of the loan depends on various factors such as:
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- The cost of the vehicle.
- The type (standard/premium).
- The percentage financing offered.
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| 2. Can my spouse's income be included for calculating the loan amount? |
| Ans :Yes, your spouse's income can be included provided he/she guarantees the loan. |
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| 3. How long does it take to process the loan? |
Ans : The processing will take between 2 to 7 days, If all the required documents are submitted as required by the banks. |
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| 4. Is it necessary to have an account with the bank from which you take a loan? |
Ans : There is no such compulsion for you to have an account with the bank. Normally banks have no problem in giving auto loans to people who do not have an account with them. |
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| 5. What is the repayment schedule like? |
Ans : The minimum amount that you are expected to pay every month is the EMI.You can repay the loan in Upto 84 EMIs.You can use our EMI calculator to determine how much you would be required to pay, based on the tenor and the amount of the loan. |
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| 6. What is EMI? How is it calculated? |
Ans : EMI stands for Equated Monthly Installments. This installment comprises both principal and interest components. Your EMI would be calculated depending on the tenor you choose, to repay your loan. |
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| 7. Can I sell my car before I repay my loan? |
Ans : NO. You cannot sell the car unless you repay the loan. An NOC is required from the financier before you can sell the car. |
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| 8. Can I pay off my car loan before the tenure is up? |
Ans : Yes you can pre-pay your loan amount. But there may be certain rules regarding the pre-payment that your financier may have. You may have to pay a small penalty, which is normally, a percentage of the loan amount that remains outstanding. In some cases, you may not be allowed to partly pre-pay the loan amount, i.e. you can pre-pay only in full. Some financiers do not penalize you if you pre-pay. |
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| 9. Who can be the co-applicants for the loan? |
Ans : Your spouse or any blood relative staying in the same residence can be a
co-applicant. |
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| 10. Do I need to give collateral to get a loan? |
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Ans : No, you don't need to give collateral. But you will have to hypothecate the car in the bank’s name and an endorsement is made in the Registration Certificate (RC) book of the vehicle. |
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11. Is credit profile important? |
Ans : Yes, your credit profile is the most important factor banks consider before funding you. Your credit profile reveals your repaying capacity. |
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12. What are the detailed components of my credit profile? |
Ans : The components of credit profile are age, profession/occupation, income/financials, previous credit history etc. |
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| 13. What can I do if my credit profile does not match the banks requirements? |
Ans : If your credit profile does not match the banks requirement you can reinforce it by bringing in a co-applicant/guarantor who would be able to match the requirement. |
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| 14. Can I increase the amount of loan that I can take and how? |
Ans : Yes, you can. You can increase the amount of loan sanctioned by clubbing your spouse's income. The spouse then becomes the co-applicant. |
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| 15. Do I need a guarantor and who all qualifies as one? |
Ans : Yes, you need a guarantor. The guarantor could be your father, mother, son, daughter, husband, brother, sister, son's wife etc et cetera. However for consideration of these relatives as guarantors for the loan, they should comply with the age and other such norms of the lender. |
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| 16. What is the extent of liability of a co-applicant and the guarantor? |
Ans : A co-applicant has is equally liable to the banks from which the loan is taken. The guarantor however, promises to pay the bank in case the applicant(s) default on the payment. Both the co-applicant and the guarantor are liable for re-payment and the banks have the right to collect from either or them. |
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Business Loan |
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| 1. Who can avail of Business Loans? |
| Ans : Self-employed individuals in the age group of 24 to 65 years (at the end of the loan
tenure), Partnership Firms & Private Ltd. Companies can avail Business Loan. |
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| 2. How much can I borrow? |
| Ans : The minimum loan amount is Rs. 75,000 and the maximum loan amount could be up to Rs. 40, 00,000 based on the Bank's qualifying criteria. |
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| 3. What are the tenure options? |
| Ans : Business loans range from a minimum of 1 year Upto a maximum of 4 years. |
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| 4. Do I need a guarantor? |
| Ans : For sole applicant - one adult family member to be co-applicant. Partners /Promoter
Directors will be taken as co-applicant in case of Partnership/Pvt ltd co. respectively. |
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| 5. How do I repay my loan? |
Ans : You have an easy repayment option through, Equated Monthly Installments (EMI) with post-dated cheques or direct debit to your bank account. |
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| 6. How long will it take to process the loan? |
| Ans : Loans are usually processed within 4 working days of completing the documentation. |
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NRI Loan |
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| 1. What is the eligibility for obtaining NRI Home Loans? |
Ans : Your eligibility is calculated in the same way as it is calculated for resident Indians. More emphasis is laid on the following criteria in the appraisal of a NRI case:
- Qualifications - the NRI applicant has to be graduate
- Current job profile & Past experience
- Probability of continuing abroad for the loan tenure
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| 2. For what kinds of property is a NRI eligible for Home loans? |
Ans : A home loan is sanctioned to the NRIs for any of the following housing finance schemes:
To purchase a house either ready-built, under construction or from a second owner.
- For self-construction of a property on a plot of land.
- To finance the purchase of a plot of land allotted by a society / development authority.
- For renovation or improvement of an existing property in India
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| 3. How is the mode of payment for NRI home loans? |
Ans : The loan towards the house has to be paid upfront for the entire tenure of the loan by way of direct remittances from abroad through normal banking channels or from such accounts as may be permitted by RBI from time to time. As of today, the payments are done through NRO, NRE, NRNR and FCNR accounts. These accounts change on the basis of RBI permissions to each HFC. |
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| 4. What is the repayment period for a NRI Home Loan? |
Ans : The housing finance offered to NRIs normally do not exceed 5 years. However, some HFCs offer loans for a term of 7 years. The repayment for the loan is by way of EMIs. |
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| 5. What are the Tax Benefits applicable to Non-Resident Indians? |
Ans : No tax benefits are available for NRI customers unless you file returns and thereby become eligible to avail of the tax benefits as mentioned under Home Loans. |
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| 6. What is the rate of interest that will be charged on my loan? |
Ans : The rate of interest will vary from 11.25% to 14.25% per annum depending on the Institution. |
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| 7. What is the maximum period in which I can repay the loan? |
Ans : The period of repayment of the loan is normally in the range of three to 10 years. However the lender will endeavor to determine the repayment period to suit your convenience |
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| 8. Are the NRIs permitted to give a Power of Attorney to a resident Indian to operate the Non-Resident accounts? |
| Ans : A Power of Attorney is given only for operations in the account and not for opening the account. Further the operations are restricted only for making legitimate local payments. In no circumstance is the Power of Attorney holder allowed to repatriate the funds abroad or make payments of gifts on behalf of the account holder. |
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