CHEQUE BOOK

HT Estates - - Front Page - Harsh Roongta

We have a res­i­den­tial prop­erty in my mother’s name and she is a Cen­tral gov­ern­ment pen­sioner. I am also work­ing in the pub­lic sec­tor. Can I get loan against prop­erty on the above-men­tioned prop­erty?

— Mukul It would be very dif­fi­cult to get a loan against a res­i­den­tial prop­erty where the bor- rower is not earn­ing reg­u­larly and is a pen­sioner. How­ever, since you are em­ployed, you can join your mother as a co-bor­rower. In that case, your in­come would also be con­sid­ered for the pur­pose of el­i­gi­bil­ity. Typ­i­cally you will be able to get up to 50% to 60% of the value of the prop­erty or twice your an­nual in­come (which­ever is lower) as a loan against your mother’s prop­erty. I have taken a home loan of R28.5 lakh at 11.50% from a well-known bank. Is it wise to switch over or de­mand for re­duc­tion in in­ter­est rate? What is the ideal in­ter­est rate that the bank should of­fer?

— Sharad The cur­rent com­pet­i­tive rate in the mar­ket for home loan amount be­low R30 lakh is around 10% to 10.25% per an­num. Since the base rate of the bank you men­tion it­self is 10.50%, it will not be pos­si­ble for them to of­fer you an in­ter­est rate be­low their base rate.

You should eval­u­ate the op­tion of switch­ing your loan to an­other lender. Since the RBI has al­ready in­structed banks not to charge the fore­clo­sure fee in re­spect of float­ing loans, you will not have to pay any penalty for shift­ing such loans. How­ever, you may have to pay some pro­cess­ing fee to the prospec­tive lender. In fact, most lenders will agree to take over your loan from the ex­ist­ing bank with­out any sig­nif­i­cant pro­cess­ing fees. So ef­fec­tively, there will be no charge for shift­ing the loan to an­other lender.

You will need a good track record of pay­ment of your EMIs on time to be able to get an of­fer from an­other bank to take over your ex­ist­ing loan. I earn R20,000 as salary (take home) and there is no de­duc­tion. My CI­BIL score is 799 and I am 33 years old. I am look­ing for a home loan amount of R13 lakh to R15 lakh. Am I el­i­gi­ble?

— Shekhar A per­son with a credit score of 799 is con­sid­ered to be a very cred­it­wor­thy in­di­vid­ual. You can ne­go­ti­ate with the lender for a bet­ter in­ter­est rate on a home loan. Nor­mally, lenders grant home loans of up to max­i­mum of 80% (90% for loan amount be­low R20 lakh) of the value of the prop­erty. The over­all el­i­gi­bil­ity will be based on your in­come, your reg­u­lar house­hold ex­penses your past credit his­tory on re­pay­ment of loans and credit card dues.

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