I bought a flat in 2007 against a home loan from a top bank. I am paying EMI regularly. I have heard that the RBI has instructed all the banks to waive pre-closure charges of 2% of remaining outstanding amount. Officials in my bank inform me that they are not waiving the charges as yet. Kindly confirm the same.
—Ritu Singh The Annual Conference of Banking Ombudsmen in September 2011 merely recommended that banks should not recover a charge on pre-payment of floating rate loans. There are currently no RBI regulations/instructions in this regard, therefore, banks are free to charge for prepayment. Some banks, though, do not charge for pre-payment if the loan is prepaid from own sources. I have an outstanding loan on a 1BHK property, which I purchased 18 months ago in Uttam Nagar, New Delhi. Now due to space problem, we are planning to move to Shalimar Garden where we could get a 2BHK flat at an affordable price. Is it possible for my existing bank to transfer the same loan to another property without any further income proof documentation (as I never default on my payments). If not please tell me what I should do.
—Mahesh Prasad There is no such thing as transferring the home loan. You will have to foreclose the home loan on your existing property if you want to sell it. You can get a home loan for your new property based on your income and credit history. Please bear in mind that foreclosing the loan may attract a prepayment penalty. If your income is sufficient to justify the loan, you should not have any problem in getting a loan for the new property.
Please note that if you transfer your house within five years, the income tax benefits availed by you, in respect of principal repayment allowed to you under Section 80 C, will be treated as your income of the year in which you transfer your property. Also note that since you are planning to sell the property within 36 months from purchase, any profits from such sale shall be regarded as short-term capital gains and taxed as normal profits. Moreover, you will not have option of claiming exemption from such gains by reinvesting. I am a single woman and have bought a house for R28 lakh at Andheri East, Mumbai, in my name. The flat is in a 32-year-old building, but is in good condition. I need a loan of R11 lakh. Which banks will give loan to a single woman?
—Roshni Palekar If your income is sufficient to justify the loan, you should not have any problem in getting a loan. The tenure of the loan and the availability of the loan itself depends on the physical condition of the property. However, as per the opinion of the engineers of the banks, the residual life of the property is more than or at least equal to the loan tenure, hence in my opinion you should not have any problem in getting any loan. However, a conservative lender may not grant a loan on an old property. There are no hard and fast rules about the age of the property for its eligibility to be considered for loan except that the residual life should be more than the loan tenure. Banks normally are wary of lending to a single borrower.