Home loan is the money borrowed from a bank or a housing finance institution on interest for buying / constructing / upgrading a residential real estate property.

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.

The banks usually offer the following types of loans on interest:

• Home Purchase Loan: It is the most common type of loan taken for purchasing a new residential property or an old house from its previous owner.
• Home Improvement Loan: Home improvement loans are given for executing repair and renovation work at home.
• Home Construction Loan: These loans are sanctioned to construct a house on a piece of land you have already purchased. The loan approval and application process for these loans is somewhat different from the other commonly available home loans.
• Home Extension Loan: Home extension loans are offered for expanding or extending an existing house. To cite a few examples, addition of an extra room, a floor etc.
• Land Purchase Loan: This type of loan is granted for the purchase of a plot of land for both residential or investment purposes.
• Home Conversion Loans: These loans are available for people who have already purchased a house by taking a home loan but would now want to buy and move to another house. With these loans, they can fund the purchase of the new house by transferring the current loan to the new house.
• Balance Transfer Loan: These loans are availed to transfer one's home loan from one bank to another. It is usually done to repay the remaining amount of loan at lower interest rates or when a customer is unhappy with the services provided by his existing home loan provider and wants to switch to a different bank.
• NRI Home loans: These are specialized loans, structured to suit the requirements of NRI's who wish to build or buy a home in India.
• Loan against Property (LAP): These loans are given or disbursed against the mortgage of a property.

As home loans involve a large sum of money, the tenure generally varies between 3 to 30 years.

Longer the tenure you have, the lesser will be your EMI but higher would be the interest outgo. In shorter tenures, you pay a greater EMI, but the loan gets repaid faster and you pay less by way of interest.

EMI or Equated Monthly Instalment is a fixed amount paid by you to the bank on a specific date every month. The EMI’s are fixed when you borrow money from the bank as a loan. EMI’s are used to pay both interest and principal amount of a loan in a way that over a specific number of years, the loan amount is repaid to the bank alongwith interest.

Under the Pre-EMI option, the borrower is required to pay only the interest on the loan amount that will be disbursed as per the progress on the construction of the project. The actual EMI payment starts after the possession of the house.

Yes. One can avail of a pre-approved loan from a housing financial institution or a bank.

The general eligibility conditions are as follows:

• The borrower should be a resident of India or an NRI
• He / she should be above 18years of age at the beginning of the loan
• Repayment should be up to the age of 70 years.

Apart from other criteria and norms of the lending bank, the home loan amount is generally calculated on the basis of your EMI and NMI ratio, where NMI is the take-home pay after taxes and other payroll deductions. The EMI/NMI ratio varies in the range of 20% to 70% for different Net Annual Income slabs. The loan amount can be increased by including a co-applicant.

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.

You would be required to submit the following documents:

• Proof of Identity: PAN, Driving license, Voter ID, Aadhar Card
• Proof of Income:
  • Salaried Applicants: Latest 3 Months salary slip showing all deductions and Form 16 for the last three years.
  • Self Employed Applicants: IT returns for the past 2 years and computation of income for the last 2 years as certified by a CA
• Bank Statement: Past 6 months

In the fixed interest rate scenario, the interest remains constant throughout the loan period irrespective of the changes in market conditions while in the floating interest rate scenario, the interest can decrease or increase depending on market fluctuations.

The interest on home loans is usually calculated either on monthly reducing or yearly reducing or daily reducing balance by Bank. SBI charges interest on daily reducing balance.

Specifics are mentioned below:-

• Annual reducing method: In this system, the principal, for which you pay interest, reduces at the end of the year. Thus, you continue to pay interest on a certain portion of the principal that you have actually paid back to the lender. This means that the EMI for the monthly reducing system is effectively less than the annual reducing system.
• Monthly reducing method: In this system, the principal, for which you pay interest, reduces every month as you pay your EMI.
• Daily Reducing method: In this system, the principal, for which you pay interest, reduces from the day you pay your EMI. EMI in the daily reducing system is less than in the monthly reducing system and a year is treated as consisting of 365 days irrespective of leap or non-leap year.

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.

Home loans are usually accompanied by the following extra costs:

• Processing Charge: It is the fee payable to the lender upon applying for a loan. It is either a fixed amount not linked to the loan amount or a percentage of the loan amount.
• Pre-payment Penalty: When a loan is repaid before the scheduled duration, a penalty may be charged by some banks, which is known as the pre-payment penalty. SBI at present does not charge any pre-payment penalty.
• Miscellaneous Costs: Bank may also ask for documentation or other consultation charges.

The following processing fees is applicable on SBI Home Loans. In addition to the processing fee, actual charges towards valuation fee, advocates fee for property search and title investigation report and stamp duty is applicable.

Processing Fee 0.35% of Loan Amount subject to a minimum of Rs 2000/- plus applicable taxes and Maximum of Rs 10,000/- plus applicable taxes

As per Section 80C of the Income Tax Act, you are allowed separate deductions on the principal and interest amount of the home loan amount, along with other entities like ULIP, EPF, PPF, ELSS and NSC’s. In case of the principal amount, you can claim a deduction of upto Rs 1.5 lakhs while in case of interest, it is upto Rs. 2 lakhs. The amount of stamp duty and registration is also eligible for tax deduction.

It is important to note that the tax break can only be claimed for the year in which the construction of the property has been completed.

Generally, banking & finance institutions pay around 75% to 85% of the cost of the property bought. The remaining 20% of the amount is paid on an up-front basis, which is popularly known as the down payment.

On an average, loans are disbursed within 3-10 days after satisfactory and complete documentation and completion of all the required procedures.

Yes, a single woman can get a loan. SBI has a special scheme for them, such as concessional rate of interest.