Both NRI and PIO are eligible for home loan.
Who is NRI
An individual shall be deemed to be a non-resident in following cases:
When he stays in India for less than or upto 182 days during the preceding financial year. The period of stay may not be ‘continuous’ and the same shall be calculated by adding up the days of his stay in India during that financial year. Thus a student who goes for studies abroad and his stay in India during a financial year is less than 182 days, then he shall be treated as non-resident Indian for the next financial year. Similarly, tourists and all others who have gone out of India without the purpose of taking up employment or starting any business abroad, shall be treated as non-residents if, their stay in India during the preceding financial year was less than or upto 182 days.
- when he goes or stays outside India for any of the following purposes:
For or on taking up employment outside India, or
For carrying on outside India a business or vocation outside India, or
For any other purpose, in such circumstances as would indicate his intention to stay outside India for an uncertain period.
Who is PIO
A person of Indian origin' means an individual( not being a citizen of Pakistan or Bangladesh or Afganistan or China or Iran or Srilanka or Nepal or Bhutan)
Point to note
Products like commercial loan ,loan against residential or commercial property to NRI are offered by only some of the banks in India.
Product features :
For Home Loan - 80% of market value .Market value is assess by bank .
For Commercial loan and loan against property – 65% of market value
max 65 years or retirement age , whichever is earlier for salaried and 70 years for self employed.
No income tax benefit is available.
NRI has to sign power of attorney in favour of resident indian . You can download the matter.If you are applying from outside india than Attorney has to be attested by Indian consulate or if applying in India than it has to be notrized on 100 Rs stamp papper .
All payments related to repayment of loan can be only through NRE or NRO account .
Loan foreclosure penalty - Means paying off the complete loan at one go.Most bank charges 2 to 3% of principal outstanding
Part payment - Means paying some part of loan.Most bank don't charge any penalty .
Co-applicant - Most banks ask for co-applicant .Co-applicant can be
Co-owners of property need to be co-applicants in loan .
3 documents are required for a loan to get disburse
1. Sanction letter: - Loan sanctioning is based on the financial documents,personal documents and past credit history of the borrower. Based on the information provided through these documents banks calculates the loan eligibility and decides on the loan amount
Documents required for loan sanctionning are :-
2. Legal report: - In this complete chain of documents , starting from allotment of the property till the last transaction , are required .Based on these documents legal report is made .
3. Technical report : - In this approved map by municipal authority is required .On map provided , physical verification of the property happens .While verification certain things are checked like area of property , usage of property(Residential or commercial) . Based on this report is made .
If all the 3 documents are approved by the bank ,than disbursement documents are signed and cheaque is made in name of seller .
This complete process takes 15 to 18 days , subject to complete documents are provided by borrower