Q1.: An NRI is eligible for a Home loan for what kinds of property? Home loans?
Ans.: A home loan is sanctioned to the NRIs for any of the following housing finance schemes:
| a) |
To purchase a house which is built, under construction or from a second owner.
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| b) |
For a plot of land which is meant for self-construction . |
| c) |
To finance the purchase of a plot of land allotted by a society / development authority. authority. |
| d) |
For existing property which requires renovation or improvement. |
Q2.: What is the eligibility for obtaining NRI Home Loans?
Ans.: Eligibility of an NRI is calculated in the same way as it is calculated for resident Indians. However, emphasis is laid on the following criteria in the case of an NRI:
| a) |
Qualifications: Minimum requirement is that the NRI applicant should be a graduate |
| b) |
Current job profile and past experience |
| c) |
Probability of continuing abroad for the loan tenure |
| d) |
Probability of servicing the loan with an extended tenure in case you have to return to India. |
Q3.: What is the repayment period for a NRI Home Loan?
Ans.: Usually the repayment period does 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 and EMIs begin only after the entire loan is disbursed. If it is partially disbursed then you pay simple interest at the rate applicable on the loan amount that is disbursed to you.
Q4.: What is the mode of payment for NRI home loans?
Ans.: The loan for 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 permitted by RBI. 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.
Q5.: Are there any Tax Benefits applicable to Non-Resident Indians?
Ans.: No tax benefits are available for NRI customers. However, if you file returns then you become eligible to avail of the tax benefits as mentioned under Home Loans.
Q6.: What are the documents needed for obtaining NRI Home Loans?
Ans.: NRIs are required to submit the following documents:
| a) |
A copy of the passport |
| b) |
A copy of the works contract (also sometimes referred to as the contract card/labor card) |
| c) |
The power of attorney (POA). The POA is required because the borrower is not based in India and in such a scenario; the HFC would need a representative 'in lieu of' the NRI to deal with as required. |
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