The Projects at NKLC are approved by Major Banks. Some of them are given as under;

What are the types of home loans available?

There are a variety of home loans available. They are:

  • Home Purchase Loan
  • Home Improvement Loan
  • Home Construction Loan

What are the eligibility conditions for a home loan?

To qualify for a home loan, most of the lending institutions in India require you to be:

  • An Indian resident or NRI
  • Above 21 years of age at the commencement of the loan
  • Below 65 when the loan matures
  • Either salaried or self employed

What are the interest rates offered for home loans? What are: Daily Reducing, Monthly Reducing and Yearly Reducing ?

Interest rates vary from institution to institution and generally range from 7% to around 9%. The interest on home loans in India is usually calculated either on monthly reducing or yearly reducing balance. In some cases, daily reducing basis is also adopted.

Annual reducing:

In this system, the principal, for which you pay interest, reduces at the end of the year. As such you continue to pay interest on a certain portion of the principal which you have actually paid back to the lender. This means the EMI for the monthly reducing system is effectively less than the annual reducing system.

Monthly reducing:

In this system, the principal, for which you pay interest, reduces every month as you pay your EMI.

Daily Reducing:

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 the monthly reducing system.

How do HFCs decide on the loan amount?

Usually,most companies give up to a maximum of 85% of the cost of the house. The balance 15%, sometimes called ‘seed money’, will have to be provided by the loan applicant. The amount, for which the applicant is eligible, is determined by the age, income, no. of dependents, monthly outgoing and repayment capacity. This varies from case to case.

Are securities required for home loans?

In most cases, the property to be purchased itself becomes the security and is mortgaged to the lending institution till the entire loan is repaid. Some institutions may ask for additional security such as life insurance policies, FD receipts and share or savings certificates in exceptional cases other fixed assets.

Do I require a guarantor to get a home loan ?

Some institutions ask for 1 or 2 guarantors, others require no guarantor at all.

What is the time required for loan application approval?

About 0-15 days.

What is the time required for loan disbursement ?

On an average, loans are disbursed within 3-15 days after satisfactory and complete documentation and completion of all relevant procedures, including proof that 15% of the cost has been paid upfront to the seller of the property.

What is an EMI ?

EMI (Equated Monthly Installment) is the amount payable to the lending institution every month, till the loan is paid back in full. It consists of a portion of the interest as well as the principal.

How is an EMI calculated ?

EMI Formula : l x r [(1+r)n /(1+r)n-1 ] x 1/12
l = loan amount
r = rate of interest
n = term of the loan

What are the income tax benefits of home loans ?

Both principal as well as interest of home loans attract tax benefits. As of now Section 88 of the Income Tax Act allows a 20% rebate on the principal repaid, subject to a principal ceiling of Rs.20,000 per annum. For loans availed of after April 1, 1999, a deduction on interest paid with a ceiling of Rs.1,50,000 is allowed. This amendment was made in the February 2001 budget to be effective from April 1, 2001. The above benefit is subject to change from time to time as per Govt./RBI guide lines. Home loans taken to repay existing home loans are not eligible for tax benefit.

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